I have an LLC that is providing a loan to an individual worth $25,000 with 9% interest rate.
I origionally had placed $4,000 into the LLC to start the LLC, and have just transfered $25,000 from my own account to fund the LLC for the loan (which will be going to that individual as the loan).
How should I report the 25k I put into the business? How will this be taxed? Will I pay tax on each payment coming to the LLC as a whole? Will only the interest on the loan be taxed? If I withdrawl any of the principal at a later time from my LLC to myself, will I have to pay any tax on this? I did not want this to be a personal loan from me to the individual, but would a personal loan have made more sense?
Any advice on this scenario would be very helpful.
