What happens to taxes if I make a loan to my business?

  • 📰 njdotcom
  • ⏱ Reading Time:
  • 36 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 18%
  • Publisher: 63%

Nigeria News News

Nigeria Nigeria Latest News,Nigeria Nigeria Headlines

Its not easy to fund a small business. Here what to consider.

to the business, which is not necessarily the right move for tax purposes, said Michael Karu, a certified public accountant with Levine, Jacobs & Co. in Livingston.For federal purposes, that will wash, he said, but not necessarily for New Jersey state purposes, Karu said.

New Jersey is a gross income state. Accordingly, partnership losses can only offset partnership gains, he said.“The LLC would issue a 1099-INT for the amount paid tohe said. “If the members are not contributing pro-rata into the business and the intent is to repay the loan, this is a good option.” If funds are being deposited on a pro-rata basis, the alternative is to deposit the funds as capital contributions, Karu said. Then you would just take a distribution of the profits as needed.“You don’t need the paper copies. Electronic is fine,” he said. “Then reimburse whoever paid those expenses from the business and record the expenses. While many items may be de minimis, they will add up.”

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 282. in NG

Nigeria Nigeria Latest News, Nigeria Nigeria Headlines