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Mark Taylor
Mark Taylor, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1608
Experience:  Certified Public Accountant
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I have a savings account I call Net Profit in my photography

Customer Question

Hi! I have a savings account I call Net Profit in my photography business, and I want to move that money into my retail company's checking account as an investment. I don't want to take a tax hit on it from my photography business, since it's not technically investing in my retail business. I, personally, am investing in it. The only thing I can come up with is to transfer the net profit money into my photo biz checking account, pay myself, moving the money into my personal checking, and in turn, taking that money and moving it into the retail business checking account. Is there a simpler way to do this?
JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: I don't think so.
Submitted: 1 month ago.
Category: Tax
Expert:  Mark Taylor replied 1 month ago.

Hi, my name is Mark. I will be happy to help you with your questions. What kind of entity is the photography business (S-Corporation, LLC, C-Corporation, or sole proprietorship)?

Customer: replied 1 month ago.
Both companies are LLCs, and I live in Florida.
Expert:  Mark Taylor replied 1 month ago.

Do you own 100% of the LLC's?

Customer: replied 1 month ago.
I own 100% of the LLC for the photography business, and my husband and I both own the retail LLC (splitting it 50/50).
Expert:  Mark Taylor replied 1 month ago.

Are either of the LLC's treated as S-Corporation's?

Customer: replied 1 month ago.
No.
Expert:  Mark Taylor replied 1 month ago.

You can either move the money from the photography business to you personally and then to the retail business. If you chose this method your capital account in the photography business would decrease and your capital account in the retail business would increase. Another approach would be to transfer the funds from the photography business to the retail business. This could be treated as a loan between the two entities. With either option there should not be a tax impact. As long as you have basis (positive capital account) in the photography business you would be able to take distributions without have a tax impact.

Expert:  Mark Taylor replied 1 month ago.

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