How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Wallstreet Esq. Your Own Question
Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
Satisfied Customers: 577
Experience:  10 years experience
16356563
Type Your Tax Question Here...
Wallstreet Esq. is online now
A new question is answered every 9 seconds

LLC Partnership Membership Assignement

Customer Question

LLC Partnership Membership Assignement
Submitted: 11 months ago.
Category: Tax
Expert:  Lane replied 11 months ago.

Hi,

...

What's your question?

Customer: replied 11 months ago.
RED Corp is a member of BLUE LLC.
RED Corp is closing its books.
Its membership interest needs to be assigned to GREEN Corp.
RED initially invested 100k in BLUE
RED has 0% share of profit from BLUE and did not receive compensation from BLUE.
RED is a foreign corp that did not file any return because it never had any income.
BLUE is required to report the transfer of membership interest on Form 8308.Other than form 8308, what form is BLUE required to file?
What form is RED required to file?
What form is GREEN required to file?
What else could be required?
Expert:  Lane replied 11 months ago.

I'll opt out here and see if someone else can help

...

As a heads-up, you'll likely need to supply a LOT more information before your question can be answered. THis is a severly underpriced question in my opinion

...

  • Are these S-Corps, S-Corps or both?
  • Can an "assignment" really happen (related parties issues and issues of overlapping ownership/control may cause this to be treated as a gain or cause losses to be disallowed)
  • How can Red have a membership interest in Blue and no profit allocation (might be possible if specified in operating agreement, but economic substance rules may still IRS to perceive as suspect)

...

These are SOME of the question that would need to be answered.

...

Good luck with it

Customer: replied 11 months ago.
BLUE is a US LLC. Blue has 2 members: YELLOW who is a US LLC and RED who is a foreign corporation.
Red cannot remain a member as it will not exist anymore.
BLUE needs to remain a LLC with at least 2 members. GREEN is suppose to replace RED.
BLUE operating agreement specify that Red would not receive any profit share and benefit only when assets acquired by BLUE are sold which never took place.

Related Tax Questions