@pk , thank you for the response!
To clarify, the LLC is a partnership (my wife and I are equal partners). Regarding (a), is square footage the only or preferred method of splitting mortgage interest and property taxes? Or would an appraisal that identifies the value of the primary home vs. secondary unit be acceptable?
(b) Yes, our situation involves itemizing. Assume the remaining mortgage principal is 800,000 (and your previous example of equal square footage between the primary home and secondary (50% and 50%), then we list our remaining mortgage principal on our individual return as 400,000. Thereby avoiding the 750k cap on mortgage interest deduction?
(c) The LLC files a 1065 and issues K1s to me and my wife for the short term rental activity. The Schedule E is only for our lease of the secondary unit to the LLC. This is what you would expect, correct?
Thank you!
