Real Estate LLC retained earnings

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  • #71240
    bravo012345
    Participant

    We have a small Real Estate LLC. Are retained earnings allowed, say a couple months rent for unexpected expenses? Would these retained earnings not pass through to the LLC members as income for that year?

    #71241
    Kaye Thomas
    Moderator

    There’s no rule against retaining earnings within an LLC. Members are taxed on earnings (net of expenses) regardless of whether the earnings are distributed.

    #71243
    bravo012345
    Participant

    Thanks, makes sense.

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