How to report real estate for a LLC?
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pam24u
Returning Member

How to report real estate for a LLC?

We are multi members LLC and we brought land to subdivide to sell later.  How do we report this?  I know we need to file a 1065.  Is the purchase price my COGS? if so does that mean we have a huge losses until the property is sold?  We all have full time job.  This is just a side business.  Not real estate professional.  more like a dealer.

2 Replies
ee-ea
Level 13
Mike9241
Level 6

How to report real estate for a LLC?

the cost is inventory so you get no current deduction. as you sell you take a pro rata portion of the cost as a deduction (the ending inventory decreases)

   

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