Premier vs. Home and Business - for tracking Rental Property LLC

sdhaber

I'm currently using Quicken Premier, but my Rental Property LLC expenses are making a hash out of my personal expenses and budget.  Is there a way to better categorize business expenses in Premier, or do I need to switch to the Home and Business version?

Frankx

Hi @sdhaber,

An LLC is a "separate entity" from you as a taxpayer under the US tax regulations and it is also a separate legal entity.  As such, it's financial records should be kept separate from your personal financial records, although that is a personal decision that you would make. 

And from a tax perspective, because the LLC must prepare and file separate tax returns, the income or loss from an LLC on a personal tax return (e.g. 1040) is shown as summarized data (i.e. - it consists of a few specific line items such as your share of net income or loss, and pass through data like credits, rather than detailed sources of income and expenses).  Therefore there is no advantage to having the LLP data in your personal Quicken data file.

So, one solution would be for you to simply maintain two Quicken data files - one for your personal finances and the second exclusively for the LLC.  That would fix your personal budget issues.  However, if you want to continue using one data file for both personal and LLC records, you could use categories which are tagged to "LLC" to differentiate between personal and LLC.  Here's more information on using "Tags" - LINK1   LINK2.

Frankx

NotACPA

1st question: Does the LLC file it's own tax return, or is it included on your IRS 1040 Schedule E.

IF it files it's own return, the LLC should have it's own Q data file.  A Q data file should contain ALL of the info for a single tax entity, and ONLY that tax entity.

IF on your Sched E, you'll need to explain further how it's "making a hash".

sdhaber

Thanks for the reply!
LLCs are included as schedules on my 1040.

When I say "making a hash" I mean to say that it makes it very difficult to analyze my personal budget.  My personal (household) income/expenses are all mixed in with the LLC's and I'm at a loss as to how to tease them out.

UKR

What categories do you use for recording your Schedule E rental income and expenses?
Are these categories correctly associated with Category Groups of Rental Income, Rental Expenses?
And are these categories correctly defined as tax-related with tax line items of Schedule E?

Frankx

Hi @sdhaber,

An LLC is a "separate entity" from you as a taxpayer under the US tax regulations and it is also a separate legal entity.  As such, it's financial records should be kept separate from your personal financial records, although that is a personal decision that you would make. 

And from a tax perspective, because the LLC must prepare and file separate tax returns, the income or loss from an LLC on a personal tax return (e.g. 1040) is shown as summarized data (i.e. - it consists of a few specific line items such as your share of net income or loss, and pass through data like credits, rather than detailed sources of income and expenses).  Therefore there is no advantage to having the LLP data in your personal Quicken data file.

So, one solution would be for you to simply maintain two Quicken data files - one for your personal finances and the second exclusively for the LLC.  That would fix your personal budget issues.  However, if you want to continue using one data file for both personal and LLC records, you could use categories which are tagged to "LLC" to differentiate between personal and LLC.  Here's more information on using "Tags" - LINK1   LINK2.

Frankx