renting house from LLC

[claurice]

I know there are other tax implications, like losing capital gains exemption. I would rather not go into the "why" ... but I am wondering if I am allowed to put my primary residence in the name of an LLC and pay fair market rent and take depreciation expenses? thank you

 

[bklynboy]

Doesnt an LLC pass through to the owner so that you still report on your taxes? What benefit are you trying to get?

 

[claurice]

Yes, I would report on K-1. I would rather focus on the question at hand, if reason is explained it will raise more questions and responses that I am not focusing on in this post, thanks.

 

[bklynboy]

Not a tax expert but I have done this myself - nothing I am aware of that says you can't transfer the property to an LLC - I did it to protect my assets as it is multi family and wanted to limit lawsuits against my personal assets. Depreciation is taken in the LLC and part of the gain/loss reported on K-1. I will say that its considered passive income so losses arising from depreciation may not be able to be deducted on your personal return. Best to sit with a CPA for a few hundered bucks and see if it makes sense for what you are trying to do. Since you dont want to give details hard for antone here to say if it makes sense - but you can do it - it just may not give the result you expect.

 

[claurice]

Thank you,..... my reason for doing so are to protect equity from FUTURE personal creditors, ex. medical bills etc. I would need to talk with an attorney as well to see if this would accomplish my goal.