LLC

nannie61 · ‎April 18, 2021

Have an LLC that is owned by 3 other LLCs. We recently bought out the 3 LLC, and are making monthly payments to the exiting LLC. How do I report payments made? Do I need to issue the exiting LLC a 1099 MISC? or 1099 NEC to report this as an expense? or will this comprise cost basis of my LLC's share in the business?

Rick19744 · ‎April 18, 2021

Wait. What @ColeenD3 ?

Some additional context would be helpful:

Did this transaction occur in 2020 or 2021?
Just confirm what type of return the upper tier LLC is filing.
Does the upper tier LLC have depreciable assets?
Not sure I understand the transaction. If the upper tier LLC had 3 members and all were bought out, who is the "we" that bought them out? Something is missing to complete this transaction.

*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.