LLC Change In Ownership

[schrau20]

I have a multi member LLC to invest in real estate. The ownership % of the two member is 50% each which has been the case from the beginning. When I try to start a 2019 return for the business and transfer 2018's information TurboTax is not picking up the partner/member information correctly. It thinks there was a change in ownership even though there wasn't and when I try to add both members it forces me to acknowledge there was a change in ownership before I can proceed. Has anyone else experienced this same problem?

[Carl]

Just a wild guess here, as I didn't use TTBusiness last year. But check under the Business Info tab >> About Your Business and make sure the radio selection for change in ownership is not selected. Screenshot below.

[Anonymous_]

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@schrau20 wrote:

Has anyone else experienced this same problem?

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Yes, that has been reported by a number of users.

However, Support has determined that, in virtually all instances, the issue originated with the 2018 returns; users either indicated that a partner left the partnership, the partnership ended, or something similar.

A couple of users reported that they were able to resolve the issue by starting their copies of the 2018 version of TurboTax Business, updating the software, fixing whatever anomaly was causing the issue, and then transferring the 2018 return into the 2019 program.

[schrau20]

It is not selected. Since it's not correctly pulling in the member information from the 2018 return when I try to add more than one member it doesn't let me do so. 

[schrau20]

Any idea what the specific issue is from 2018? I tried to see if there was a box checked or something but all of the information is correct and I'm still having the same issue with the 2019 return. Thanks

[Anonymous_ · Accepted solution]

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@schrau20 wrote:

Any idea what the specific issue is from 2018? 

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From my understanding, there is more than one, including not having the latest software updates.

However, I would focus on the partner/member information in terms of percentage of ownership, et al. If you cannot seem to resolve this, you should contact Support (link below).

https://ttlc.intuit.com/community/using-turbotax/help/what-is-the-turbotax-phone-number/00/25632

[Craig Longhurst]

I'm frustrated with change of ownership percentages in filing our 1065 as an LLC.  Can anyone help?

[Critter-3]

Contact TurboTax support and speak directly with a TurboTax support agent concerning this situation.

See this TurboTax support FAQ for a contact link and hours of operation -https://ttlc.intuit.com/questions/1899263-what-is-the-turbotax-phone-number

[jaimetrabert]

I am also having problems with this. Anyone solved it? 

[Anonymous_]

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@jaimetrabert wrote:

I am also having problems with this. Anyone solved it? 

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There is no resolution beyond what is mentioned in this thread.

[rmclemor]

There still appears to be a problem in the 2021 version of TurboTax for business.  I am trying to enter an ownership change from 3 partners split evenly to two partners split evenly.  The percentage changes are not updating correctly on the K-1 forms and the system doesn't allow me to update the forms to make the percentages on each of K-1 forms accurate.  If this is not going to get fixed, then there is no way for me to accurately file my taxes using TurboTax.  

[RobertB4444]

@rmclemor When a partnership changes ownership then the IRS aggregates the percentages over the year. 

So, if you start with three partners at the beginning of the year and change to two partners halfway through the year then the percentage of ownership does not just flip to 50%.  In that particular case the ownership percentage would show as 41.8% for each of the partners who stayed and 16.4% for the partner who left mid-year.  

Check the date that you set for the ownership change and make sure that it doesn't change during the tax year affecting your percentages.

[rmclemor]

Thanks for your answer.  The ownership change was effective January 1 so basically the entire year.  The issue Thanks for your answer.  The issue I have with the 2021 desktop version of TurboTax is once I select the checkbox indicating there is an ownership change, I have no access to the screen to enter the percentages for profit, loss and ownership for each partner.  The K-1s are then automatically populated with the percentages from the prior year and I can find no way to update them either through a screen or directly on the form.  I found a work around by not clicking the ownership change.  Then I can get to the screen to enter the correct percentages.  I get an error message on the K-1 for the partner with 0 percent since she was not a partner for the entire year.  I selected the check box that this is the final K-1 which resolved the error.  However, I think there is another form that is triggered by entering an ownership change that will be missing from my tax return if I don't find some other way to work around this problem.   Any suggestions?  

[RobertB4444]

You're thinking of form 8308 (there's a copy here to see).  It can be filed separately from your return, or you can print the return and the form and mail them together.  The form is supported by TurboTax and can be added to your return for e-filing.  If you are using the desktop program you will be able to look at the forms you have included.  In the online version you won't be able to look at forms until you have finished and paid for the software - but you can check before you file.

[Critter-3]

For the 2021 tax year there was NOT an ownership change ... that happened 1/1/2022 and is not reported on the 2021 return.