Lenders: how important are LLC tax returns w/ K-1 v. putting LLC income on personal return?
The title mostly says it. Right now I have multiple LLCs that are partnership with my spouse and me. Every year I spend $3000-5000 getting tax returns prepared for these LLCs. This generates a K-1 that we put as income on our personal return.  
If I eliminate either my spouse or me in the LLC, we can put the income directly on our personal return and forgo the CPA expense for doing the LLC returns that generate the K-1s. 
The only downside I can see would be future loans where the lender may want to see actual LLC returns in addition to our personal one. 
Is this an issue? Or not a thing?
[{"id": "gvr0g4b", "text": "I would say depending on the size of your holdings it may matter. Frankly it's easier to the lender with everything on your Schedule E and using disregarded entities. Assuming you are Personally guaranteeing everything it's easier. I would say if you have non-recourse debt you shouldn't include that on a Schedule E and jeep that separate. \n\nI am a Commercial Lender with loan sizes from $5MM and up and I would be fine with it. I would say if you have more than $30MM in debt then you may want to separate out otherwise like you said it's cheaper and easier.", "replies": [{"id": "gvr4f9n", "text": "Awesome, thank you for the response! This is extremely helpful.", "replies": [], "depth": 2}, {"id": "gvsd89u", "text": "Commercial lender here as well and I agree. Just keep decent company/internally prepared statements as well.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gvruogz", "text": "I\u2019m a part of numerous partnerships as well.  Just buy TurboTax business for $100 and you can do all of your partnership returns yourself.  It\u2019s really simple.", "replies": [{"id": "gvs29xu", "text": "This is interesting, it never occurred to me to do that. I\u2019ll check it out. \n\nMy hope is that by going from a partnership to disregarded entity that won\u2019t be a taxable transaction.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gvsb0ru", "text": "Penny smart and pound foolish.", "replies": [{"id": "gvx2xq2", "text": "Can you elaborate on why?", "replies": [{"id": "gvxzorq", "text": "Do you know how to do taxes?  Specifically real estate taxation? I\u2019d be very careful.  A good tax accountant can help you save tens, if not hundred of thousands of dollars in tax, over the life of the assets.", "replies": [{"id": "gvyiqmt", "text": "I still have a CPA do my personal return. This only eliminates the LLC returns, the numbers won\u2019t change.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "gvsvo66", "text": "It is much easier to deal with an asset based lender that does not account for DTI. Our Hedge only uses DSCR as a basis for adequate cashflow to make payments as apposed to your income.\n\nwww.investorschoiceloans.com", "replies": [], "depth": 1}, {"id": "gvtj3gv", "text": "To the IRS any income from an LLC is passed through to the owners.  All K-1s reflect this.", "replies": [], "depth": 1}, {"id": "gvu1x1e", "text": "LLC tax returns are requested (and sometimes required) by lenders for a few non-income reasons:\n\n* LLC ownership via the K-1s\n\n* To verify that the Borrower provided/created balance sheet matches with what is being reported to the IRS via Schedule L. \n\n* Net cash flow distributions via the K-1. Individuals don\u2019t report distribution income on their tax returns if the taxes are paid through the LLC", "replies": [], "depth": 1}, {"id": "gvu8vab", "text": "If you're not keen on providing your personal tax information to lenders and such, you could form a new multi-member LLC with you and your spouse, and then make that LLC the single member of all of the individual LLCs. Since the property LLCs would all be disqualified entities, this would result in a single partnership tax return and a single K-1 for each of you, which could save you a lot of money with the accountant.", "replies": [], "depth": 1}, {"id": "gvvaf6m", "text": "Every CPA I've used takes the position that spouse and me is equivalent to me - disregarded and go directly on personal return.", "replies": [{"id": "gvvat6l", "text": "Good to know! I spent my morning looking through IRS regs. It looks like if it\u2019s just a married couple instead of strangers that we can elect to do a disregarded entity tax return without paying the taxes on a \u201csale\u201d from one partner to the other. I hate paying tax return fees but paying taxes on the sale would be exponentially higher. I am going to see if my CPA agrees with my reading of the IRS code.", "replies": [], "depth": 2}], "depth": 1}]