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Hi from just answer. I'm PDtax, and can assist.
The purchase of an interest by the entity can be pretty complex. Retention of the interest, resale to the partners, retirement, the assets repurchased all make this complicated. Sorry, but this will take some technical time and review to assist properly.
I will offer you a 1/2 hour consult to review your transaction and assist. That assumes you need the tax side of things.
If ask you want is the book side, you don't create goodwill on your own assets, but a negative partner Equity debit.
The book entry is a debit to the remaining partner equity.
Allocate the 500k in the ratio of their remaining interests. Let's say you bought out a 20% partner for $550,000, and his Equity for books was 50k:
Partner a (40%) 250,000 (debits)
Partner B (40%) 250,000
Partner C (20%) 50,000
Cash. 550,000 (credit)
These will not be considered distributions. You are just making book entries. They will have no tax impact. the tax gain or loss is much different, as mentioned earlier.
Thanks again. Positive feedback is appreciated. I'm PDtax.