I am running into a rash of business loans to professionals that are done in the name of the individual rather than the business (Joe Dentist vs Joe Dentist, PLLC). The revenue stream for Joe Dentist is income from a K-1 from Joe Dentist, PLLC, in the form of income as it transitions from the PLLC to the individual. From a GAR standpoint, what does one do in these situations? Clearly we rely on the GAR of the business. Gross Annual Revenues section of the CRA Guide does not address this, not did I find anything on K-1s in the CRA section of BOL.

Anyone? I received a private e-mail from someone else asking this question wondering if I had a reply, so I know I'm not that only one stumped.

Because the borrower is the individual I would use the individual's income - the individual and the LLC are not one and the same. I would discuss with the lending folks why why are making these loans this way rather than to the business, with the guarantee of the individual. They may have a reason but it escapes me!

Thanks, KB - you indicate you'd use the individual's "income". I wonder about that vs revenues. Any way you cut it, it's convoluted at best. I agree with you about making the loan to the business rather than the individual, especially when it comes to small business revenue reporting.

Well, individuals do not have "revenue" they have income. So, his gross from his K1.

OK - that makes sense. Thanks much for your take on this.