If you are reporting the LLC Rental Activity on your personal Form 1040 tax return, you have two options:
1. If the amount of interest is not significant, report the Form 1099-INT under the interest topic without any adjustment.
2. If your rental property qualifies as a trade or business, and the amount is significant to your net rental income, then you can include the interest income on your rental Schedule E. Your best option is to include the interest from Form 1099-INT as additional Rental Income.
For the second option, to show that you are reporting Form 1099-INT, enter the information under 1099-INT topic.
- Look for the screen "Tell us if any of these uncommon situations apply."
- Choose "I need to adjust the taxable amount".
- Show the entire amount as the adjustment (positive number) and choose "other reasons."
- Both the 1099-INT income and adjustment will show on Schedule B (net $0 on Sch B), satisfying the IRS requirements.
However, if the LLC is filing a separate business return (corporation or partnership), enter the 1099-INT under the interest income topic for the business return.
@ML1000
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