Should rented software be included on my LLC's balance sheet?
I was only able to find Maryland form 1 to fit your question, so I'll assume you're referring to this form. Note the requirement: Generally all tangible personal property owned, leased, consigned or   used by the business and located within the State of Maryland on   January 1, 201 must be reported. Software license (whether time limited or not, i.e.: what you consider as rental vs purchase) is not tangible property, same goes to the license for the course materials. Note, with digital media - you don't own the content, you merely paid for the license to use it. Design books may be reportable as personal tangible property, and from your list that's the only thing I think should be reported. However, having never stepped a foot in Maryland and having never seen (or even heard of) this ridiculous form before, I'd suggest you verify my humble opinion with a tax adviser (EA/CPA) licensed in the State of Maryland to confirm my understanding of this form.
If you know the amounts that were combined ($5,000 and $7,500 in your example) -- NOT the original loan amounts necessarily -- then you can calculate a payment schedule (in Excel, Google Sheets, online, etc.) using that amount and the interest rate.  You can then apply your payments ($100) to that payment schedule, making sure to either accrue interest if your $100 didn't cover the monthly payment, or pay down extra principal if your $100 more than covered the payment.   The outstanding principal is the amount left or remaining balance. A program like GnuCash or Quicken makes doing the payment schedule, and applying payments relatively easy to handle.  Spreadsheets will require you to have 36 lines (3 years x 12 months) of payment and recalculation detail, but that shouldn't be too much work. To be fair to your mother, make sure you include any partially accrued interest on the full balance when paying it off.  Or even better, include a full month's interest in the pay-off amount. Best Linux software is PostBooks. It is full double entry, but there is definitely a learning curve.  For platform-agnostic, my favorite is Xero, which is web-based. It is full double entry balance sheet, the bank reconciliation is a pleasure to use, and they are coming out with a US version this summer. Easy to use and does everything I need. "To my knowledge, there's no universal equation, so this could vary by individual/company.   The equation I use (outside of sentiment measurement) is the below - which carries its own risks: This equations assumes two key points: Anything over 1.2 is considered oversold if those two conditions apply.  The reason for the bear market is that that's the time stocks generally go on ""sale"" and if a company has a solid balance sheet, even in a downturn, while their profit may decrease some, a value over 1.2 could indicate the company is oversold. An example of this is Warren Buffett's investment in Wells Fargo in 2009 (around March) when WFC hit approximately 7-9 a share.  Although the banking world was experiencing a crisis, Buffett saw that WFC still had a solid balance sheet, even with a decrease in profit.  The missing logic with many investors was a decrease in profits - if you look at the per capita income figures, Americans lost some income, but not near enough to justify the stock falling 50%+ from its high when evaluating its business and balance sheet.  The market quickly caught this too - within two months, WFC was almost at $30 a share. As an interesting side note on this, WFC now pays $1.20 dividend a year.  A person who bought it at $7 a share is receiving a yield of 17%+ on their $7 a share investment. Still, this equation is not without its risks.  A company may have a solid balance sheet, but end up borrowing more money while losing a ton of profit, which the investor finds out about ad-hoc (seen this happen several times).  Suddenly, what ""appeared"" to be a good sale, turns into a person buying a penny with a dollar.  This is why, to my knowledge, no universal equation applies, as if one did exist, every hedge fund, mutual fund, etc would be using it. One final note: with robotraders becoming more common, I'm not sure we'll see this type of opportunity again.  2009 offered some great deals, but a robotrader could easily be built with the above equation (or a similar one), meaning that as soon as we had that type of environment, all stocks fitting that scenario would be bought, pushing up their PEs.  Some companies might be willing to take an ""all risk"" if they assess that this equation works for more than n% of companies (especially if that n% returns an m% that outweighs the loss).  The only advantage that a small investor might have is that these large companies with robotraders are over-leveraged in bad investments and with a decline, they can't make the good investments until its too late.  Remember, the equation ultimately assumes a person/company has free cash to use it (this was also a problem for many large investment firms in 2009 - they were over-leveraged in bad debt)." "My opinion: including the value of depreciating property one owns in a net worth calculation is silly - but could be interesting You don't expect your TV or laptop to gain value.  Instead, you expect them to decrease in value every year until you replace them.  Anything you expect to hold or increase in value (art, a house, etc) is a different story. If you'd like to really get anal about this, you can track your net worth like a business would track its balance sheet.  I'm not going to go into detail, but the general idea is that when you purchase an item, you debit the cost from ""cash"" and add the value paid to ""assets"" (so your net worth doesn't change when you make a purchase).   You then depreciate the value of the item under ""assets"" according to a depreciation schedule.  If you plan on replacing your laptop every three years, you might subtract 33% of the value every year.   This could be an interesting exercise (i.e. even if you make money, your net worth may decrease because of all the depreciating junk you own), but my hunch is that it wouldn't be worth the effort it requires." The money your tenants spent on repairs and maintenance that is otherwise your responsibility is considered rent paid to you (and deductible to the extent you can deduct maintenance expenses, provided you have documentation etc etc). The money your tenants spent on utilities, which is their responsibility anyway, is not considered rent paid to you. Since in your question you seem to be mixing both together, it is hard to accept a claim that the additional $300 spent on utilities and maintenance is enough to bring the rent to the FMV level. Especially since the transaction is between related persons, it may bring additional scrutiny of the IRS. According to the Illinois Department of Revenue, you don't have to file any taxes that are specific to a LLC, only your personal taxes. LLC on Federal level is disregarded, instead you submit all your business income/expenses on Schedule C. On the state level - it seems to be the same (only individual tax return). Consult your state certified tax specialist. That is not the case in other states, for example in California LLC has to file its own tax return and pay its own taxes, in additional to the individual taxes. "-Alain Wertheimer I'm a hobbyist... Most (probably all) of those older items were sold both prior to my establishing the LLC This is a hobby of yours, this is not your business. You purchased all of these goods for your pleasure, not for their future profit. The later items that you bought after your LLC was establish served both purposes (perks of doing what you love).  How should I go about reporting this income for the items I don't have records for how much I purchased them for?  There's nothing you can do. As noted above, these items (if you were to testify in court against the IRS). ""Losses from the sale of personal-use property, such as your home or car, aren't tax deductible."" Source Do I need to indicate 100% of the income because I can't prove that I sold it at a loss? Yes, if you do not have previous records you must claim a 100% capital gain. Source Addition: As JoeTaxpayer has mentioned in the comments, the second source I posted is for stocks and bonds.  So at year begin of 2016, I started selling what I didn't need on eBay and on various forums [January - September]. Because you are not in the business of doing this, you do not need to explain the cost; but you do need to report the income as Gross Income on your 1040. Yes, if you bought a TV three years ago for a $100 and sold it for $50, the IRS would recognize you earning $50.  As these are all personal items, they can not be deducted; regardless of gain or loss. Source Later in the year 2016 (October), I started an LLC (October - December) If these are items that you did not record early in the process of your LLC, then it is reported as a 100% gain as you can not prove any business expenses or costs to acquire associated with it.  Source Refer to above answer.  Refer to above answer.  Conclusion Again, this is a income tax question that is split between business and personal use items. This is not a question of other's assessment of the value of the asset. It is solely based on the instruments of the IRS and their assessment of gains and losses from businesses. As OP does not have the necessary documents to prove otherwise, a cost basis of $0 must be assumed; thus you have a 100% gain on sale." "I've hired a lawyer to make sure all the T's are crossed.   - I am not charging my employer for the service. I created a ""Free tier"" that fits the scale of my employer, and implemented it that way for them. Larger government bodies are paying for the higher tiers. On multiple levels, i've been sure that nothing conflicts with either our purchasing policy, or any written employee policies.    - I did 100% of the work on my own time and using my own resources. I was extremely careful to ensure this was the case. There is no clause anywhere in my employment agreement that says the company owns anything I do outside of company time. Believe it or not, this is actually less of an issue for a government body because the government doesn't exist to make a profit from services, and because they are getting an expensive service for free, it's actually a significant net benefit for them.  I certainly would be at a significantly higher risk if I was working for a for-profit corporation as they certainly would try to go after me.    - I was also careful in how the software was presented. While I agree there is a level of a obfuscation without a doubt, I've confirmed it certainly not a legal issue for the company, nor is it grounds for a lawsuit, and likely not even grounds for termination (although at this point, I don't really care as I have bigger fish to fry)"