Hi,

I have an LLC with three of my friends, and I'm thinking of taking out a loan to purchase some equipment. I understand that being part of an LLC enables one to deduct the loan costs (interest and such) on one's own tax forms. What I'm wondering is if I go ahead and do this, do I need to apply for the loan and include the name of the business? I know I'd be personally liable should I default, and that's fine, but I would like to be able to deduct this thing from my taxes.

Any advice would be much appreciated. Thanks.

let me suggest 2 things. Check with a lawyer and an accountant. They are the professionals in that arena an would have all the RIGHT answers.
Don

Yes, check with a professional. At first glance, though: the interest that your LLC pays for its loan will be an expense that can be deducted from the LLC's income, not your personal income. If, overall, the LLC posts a loss at the end of the year, that loss may be transferred to the members/owners, according to the distribution system that all the owners have agreed on.

The basic rule is that the LLC and its owners are treated separately. An expense for the company is not automatically a tax deductable expense for you.

- Martin

each member will receive a Schedule K ? ( I believe thats the one ) that will need to be attached and rolled into each members personal taxes. You really need a tax person to prepare the paperwork for the LLC even if you do your own personal taxes. IMO