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I have an LLC member that has left the business. Another…

Customer Question
I have an LLC...

I have an LLC member that has left the business. Another member took the leaving member's percentage by paying the leaving member directly. Is there an entry I need to do? I'm using TurboTax and it has adjusted my opening member equity to reflect the change (which was in 2016).

Accountant's Assistant: The Accountant will know how to help. Is there anything else important you think the Accountant should know?

All member's have a negative equity since the business has consistently been a loss since 2012.

Submitted: 6 months ago.Category: Finance
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Answered in 16 minutes by:
3/7/2018
Financial Professional: Lev, Tax Preparer replied 6 months ago
Lev
Lev, Tax Preparer
Category: Finance
Satisfied Customers: 33,734
Experience: Personal Investment, Tax Preparation
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You will need to issue a FINAL K1 to the partner who left.

Then - you simply combine capital accounts for the partner who took over.

That partner will need to track his/her basis in the partnership interest.

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Customer reply replied 6 months ago
The final K-1 was given to them in 2016. The membership interest was combined on the balance sheet so I didn't do a journal entry. TurboTax adjusted the membership interest by that partner's previous losses and is saying my balance sheet is out of balance. Do I just ignore what it's doing? It's saying my 2016 balance sheet on the return is out of balance.
Financial Professional: Lev, Tax Preparer replied 6 months ago

You need to combine these two shares.

Seems as you just change the percentage - but did not combine sub-accounts.

You need to transfer the partner's interest to a new partner.

Do not ignore.

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Financial Professional: Lev, Tax Preparer replied 6 months ago

I appreciate if you take a moment to rate the answer.

Experts are ONLY credited when answers are rated positively.

If you still have any doubts, need clarification - please be sure to ask.

I am here to help you with all Social Security / Tax related issues.

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Customer reply replied 6 months ago
My question was not answered. Thanks for the effort though. I’ll try calling TurboTax.
Financial Professional: Lev, Tax Preparer replied 6 months ago

No problem.

You may simply ignore the answer if it has no value for you.

Your satisfaction is 100% guaranteed.

You are welcome back for all your tax related issues.

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