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Category: Tax
Satisfied Customers: 5884
Experience:  CPA with tax experience.
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I put cash from my personal savings into my LLC in 2009. The

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I put cash from my personal savings into my LLC in 2009.

The LLC is now generating some income.

I want to take the cash back out without paying taxes, can I do that?

I will not be fully repaid before the year end, can I continue taking money out of the LLC next year?

To date, there is no loan document between myself and my LLC, is that needed?
Is your LLC taxed as a sole proprietorship, partnership or corporation?
Customer: replied 7 years ago.
my bad, actually it is an s corp



Thanks for your question.


For an s-corp, you are considered a shareholder. Any cash that you put in to the LLC is considered an investment in capital. Your capital account should therefore increase. Any cash that you withdraw from the LLC is considered a shareholder's draw and your capital account should decrease.


You just need to keep a good accounting of your LLC investments and withdrawals so that you can figure your basis. The basis is not considered in tax until your ownership interests are eventually sold in the LLC.


You do not have to have a loan document for a withdrawal unless that is required by your LLC or requested by the officers of the LLC.


Any items of income or expenses in the LLC for each year will be reported and allocated proportionately by ownership % on your Schedule K-1 to be reported with your Form 1040. This is known as the S-corp flow-through system. You will only be taxed on what the Schedule K-1 states.


Let me know if you have any questions,

Best regards,

JKCPA and 4 other Tax Specialists are ready to help you