Billing and accounting for partnerships, LLC's

[Glen R]

I'm purchasing a plane with a partner and we are forming an LLC. I would like some help and suggestions with how to set up a template for accounting of dollars in, dollars out, hourly charges, fuel, reserves, etc. I'm sure there are many ways of doing this and would welcome anyone willing to share a template, sensitive material deleted of course. Thank you.

 

[Jeff Oslick]

1) Get a separate checking account for the LLC
2) Use a basic version of Quickbooks for accounting. If you aren't familiar, find an accountant or experienced bookkeeper to help you set up the correct accounts in Quickbooks. It will be well worth a couple hours of professional time up front to do it correctly from the start.

As a corporate entity, you'll have factors like depreciation to consider, which will have significant tax implications.

 

[bradg33]

I use a Google Spreadsheet for LLC accounting, relatively basic. PM me your email address, I can send you the form I use.

 

[OkieAviator]

I use a Google Spreadsheet for LLC accounting, relatively basic. PM me your email address, I can send you the form I use.

I use a basic ledger as well in Google .. However we just split costs, don't do max hold backs based on flight times. Engine overhaul will get split when some sells their share or we do the actual overhaul.

 

[denverpilot]

One of our co-owners just made an excel spreadsheet and it keeps growing and having interesting things added to it when we think up weird questions to track.

Separate bank account for the LLC of course. I set up an electronic transfer authorization from my CU to the bank the LLC lives at and when I get the spreadsheet and take a quick sanity gander at it, I log into the CU and set up a transfer direct to the LLC account the next business day.

No need for it to be fancy or difficult. Plenty of clubs still did this stuff on paper with a ledger book when I started flying.

 

[Code90]

We have three guys in LLC. Keep two bank accounts. Savings acct for motor replacement fund and checking for all else. We all put in money as assessments for the LLC on a quarterly basis into checking. These pay for the hanger, insurance, taxes, oil, annual, etc. We each pay $25 / tach hour flown in addition. $20 goes toward engine (savings) fund and $5 into checking to offset the oil changes. We keep a paper form in the plane to track hours used by each person. I just do an excel spreadsheet to track the account balances and what each guy owes.
Plane is not used as for-profit business use. Plane is not being depreciated. It's pretty simple and straight forward.

 

[ggroves]

As a corporate entity, you'll have factors like depreciation to consider, which will have significant tax implications.

If you are leasing back, or using it for business, then yes.

Forming a partnership to share an airplane, then no.

Keep it simple. LLC checking account. Monthly "business" meeting to contribute funds to the account, review expenses, reserves, maintenance, upgrades, etc.

In Virginia, we had to file a simple annual report with the SCC, and pay the annual registration fee.



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[airdale]

... As a corporate entity, you'll have factors like depreciation to consider, which will have significant tax implications.

Probably not. It's a hobby business, so you can't deduct losses anyway and you won't have any income -- you're paying in, remember.

If (unlikely) you set up as a 501c(7) nonprofit club, again you don't have to worry about taxes and you don't have to fool with depreciation schedules. One good way, IMO, is to just mark the assets (hangar, airplane, etc.) to market each year and book the changes directly to owner's equity. That keeps them off the P&L and it makes the balance sheet a reasonably accurate estimate of the owners' true equity. Depreciation is an accounting fiction that rarely corresponds to what is really happening with assets.

 

[Diane]

Hi folks, I'm wondering if anyone has a partnership spreadsheet they could share with me? My husband and a partner are buying an airplane, and setting up an LLC. I can provide an email, if you have something to share? Thanks.