I transferred $4,000 of personal funds into my business bank account in early 2017. How is this "seed" money handled?

[garrett-olson1]

I transferred $4,000 of my personal funds (already taxed) into my LLCs bank account in early 2017. This money was used throughout 2017 for business expenses. 

• Is this "seed" money considered business "income"?
• Do I need to report this on a Schedule C?

[JulieCo · Accepted solution]

Funds that you transferred into your business bank account would be considered "equity" in the business, therefore it is not income.  

And Schedule C does not require any equity information to be reported on it, therefore, your cash contributions to the business do not need to be reported on Schedule C.

You will want to personally keep track, though, of what cash amounts you have injected into the business as it will increase the "basis" of your investment in it.