A husband and wife were partners in an LLC. The w transf her shares to h at the end of September 2025. How do I report get TTax to show the wife's 9months of income?

[TaxPro-NOT]

I changed their ownership percentages on the K-1 w/s which resulted in husband getting 100% of income on his K-1 and nothing for the wife. Where else do I need to record this transfer?

[MelindaS1 · Accepted solution]

This will be input as a Change of Ownership. You can search for ownership change in the help center (F1) or pull it up under Show Topic List in TurboTax Business Desktop for assistance. To navigate:

1. Step-by-Step
2. Business Info
3. Partner/Member Information
4. Proceed through the partner interview screens until you get to the partner who withdrew this year; when prompted, check the box for "this partner left the business during the year". Any distribution(s) they received on redemption should also be recorded in their partner info.
   • Checking this box will lead to a series of additional interview screens asking for details of the transfer, including the Date of Ownership Change; here, enter the date in September.
   • The very next screen will ask about the change in profit and/or capital percentages before and after the ownership change in September; enter the before and after %'s. Now the prorated income will flow correctly to the K-1s. 

For more guidance, see: IRS Pub. 541, Partnerships - Disposition of Partner’s Interest - Sale, Exchange, or Other Transfer

[TaxPro-NOT]

Thank you MelindaS1.  I found an answer from 2024 with the same instructions.  I worked out perfectly, finally.

Scott D.

[AmeliesUncle]

As a side note ... did the Partnership file an extension?

It sounds like the husband is now the sole owner of the business, which would mean the Partnership ended in September.  Unless an extension was filed, the due date of the Partnership return was December 15th.

[TaxPro-NOT]

Thank you for your response, the h & w shared a 1/3 ownership in an LLC. So, no need to file a final return for the partnership.