Can You Apply LLC Loss Against W2 Income?
Hi,
My husband and I are looking into forming an LLC to invest in our first income property. If we have negative cash flow (for the first year), can we deduct this against my husband's W2 income and use it to decrease our personal tax liability?
Thanks, Liberty :-?
Simply put...YES!, with some conditions.
As far as I know, an LLC and an S corp are "pass-through" entities. This means that they are a separate entity from you with its own income and expenses. The net income or loss from the busuness is what you report on your personal Income tax.. You ca be an employee of the LLC and save in taxes by creating a 401 plan for your LLC.