LLC, a partnership, in home rental business, issues a K1, with net loss, to its partners that includes al rents received, expenses, and depriciation. Without the depriciation it is positive, so the LLC flows the cash to its partners. Now, should the LLC issue a 1099-Misc as well? If it does 1099-Misc, how should the partners handle it since all the income and expenses are already accounted for in their K1s?
No, it isn't necessary to to issue a 1099 MISC in addition to the K-1.
Thank you. Without issuing a 1099-Misc, need further clarification, please.
Amount on K1 Box 1 reflects (rental income - expenses - depreciation) as a loss.
Cash, without the depreciation (rental income - expenses) is positive and flown to the partners be somehow reflected on the K1? How? Thanks
You need to report the cash distributions to the member's on the Schedule K and Schedule K-1 box 19 code A.
Each member will need to understand how to maintain their tax basis in the investment.
This worksheet needs to be updated every year for the applicable items on the K-1.
Partnership tax gets complicated very quickly, so it may be in your best interest to get some professional advice / input.