We had an accountant prepare the taxes for our LLC. There is both rental and royalty income associated with this small LLC. There was no Schedule E included with the K-!, yet Turbo Tax is generating one as I prepare my taxes. Turbo Tax says that income from rental real estate and income from royalties must be reported as separate properties on Schedule E. I called the accountant's office and was told that Schedule E's are not used with LLC's.
@nanycooley07 wrote:
I called the accountant's office and was told that Schedule E's are not used with LLC's.
Your accountant is correct; multi-member LLCs report rental real estate income and expenses on Form 8825, not Schedule E.
Your K-1 should contain all of the information you need to prepare your individual income tax return and you will see an entry on Page 2 of your Schedule E for the LLC.