Tax Reduction Letter - Buy the Building. Rent It to Your Business. Avoid Passive Losses.

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Article Date:

December 2019

Word Count:

182

Buy the Building. Rent It to Your Business. Avoid Passive Losses.

Question

My clients are a husband and wife team. They operate their business as an S corporation. For many years now, the S corporation has rented a building from a third party.

About two months ago, my clients formed a separate LLC and had the LLC purchase the building, and now the S corporation pays rent to the LLC.

My question concerns the LLC. It’s going to show a tax loss due to the building’s depreciation. My clients will not have enough hours ... Log in to view full article.

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