How to pay myself back for personal loan to buy land for my business

[doingmyowntax]

My spouse and I used our own money to purchase land under our 2 member LLC owned by myself and my spouse.  Since business has a profit now and the title of the land is under the LLC.  How do I pay ourselves back for the no interest loan to purchase the land?  Not sure where to enter this in turbo tax.  

[Anonymous_ · Accepted solution]

@Rick19744 

It appears as if you simply made a contribution to capital (which can be returned to each member without consequence - unless the amount somehow exceeds your basis).

[doingmyowntax]

Do I need to report this in TT on any form?

[Anonymous_ · Accepted solution]

Not unless you are keeping a balance sheet.

[doingmyowntax]

Do I deduct the personal loan repayment as an expense from the business?  I estimate that it will take over 10 years to repay the business personal loan to myself.

[Anonymous_]

The loan repayment is not an expense.

[Rick19744]

A few comments / questions:

• Is the LLC filing a 1065 (you don't mention whether you are in a community property state)?
• If the LLC is a separate entity and filing its own tax return:
  • You indicate you used your own money to purchase, yet the purchase was titled in the name of the LLC
  • Did you contribute $$ to the LLC?
  • It's not really a loan if you are not charging interest.  The IRS will just take the position that this is a contribution to capital (this depends on the response to a previous question)
• As @Anonymous_ noted, this transaction appears to only be impacted by balance sheet accounts
• Need to respond to the above to be more specific