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Category: Tax
Satisfied Customers: 12691
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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My question is does the capital account increase/decrease

Customer Question

My question is does the capital account increase/decrease from the LLC K1 form get brought in as a taxable item/deduction on the LLC member's personal tax return? Guaranteed payments to member are brought in as income, but then how does the LLC's ordinary income or loss get brought into the member's personal tax return?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.

Hi. My name's Lane. I can help here

Expert:  Lane replied 1 year ago.

The capitall account changes are a RESULT of things that happen on the income statement.


AND a result of distributions ... but they don't affect the income statement... Capital accounts are a balance sheet issue


The income flows to the schedule E and then end up in line 17 of the 1040


I hope this has helped. … Please let me know if you have any questions at all.


If this HAS helped, and you DON’T have other questions … I'd appreciate a positive rating (using the stars or faces on your screen, and then clicking “submit")

Otherwise I’m working for no crediting at all here


Thank you!


I hold a law degree, (Juris Doctorate), with concentration in Tax Law, Estate law & Corporate law, an MBA, with specialization in financial accounting & tax, a BBA, and CFP & CRPS designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice, since 1986.