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akhawam
New Member

Filling form 1065, how to report general LLC expensis

I have an LLC that owns properties, I'm trying to use TurboTax for business to file my 1065 form. The rental income and expensis for each property is easy to do (through Form 8825), what I don't know is how to account for general LLC expensis that are not directly related to a specific rental, things like: Attorney fees (legal consultations pertaining to running the business), Tax filing and preparation fees...etc. How do I report these fees?

 

1. Do I include them on the Ordinary business income (loss)  section (Schedule K) of my 1065?

or 

2. Do I divide these costs between the different properties and report them as rental expnese (Form 8825)?

 

My understanding is that with option 1, this is considered a business income (loss) and that should not be the case for rental income that is completely passive (I am not a realestate professional). On the otherhand, following the second apporach does not make sense because these are not rental expenses, can you please advise?

 

Thanks

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1 Reply

Filling form 1065, how to report general LLC expensis

i would say use #2 because these are incurred for the purpose of running the business and filing the return.   there does not appear to be a 3rd non-rental business activity.  

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