Thanks! I know logically that you can't have greater than 100% aggregated ownership, but Paragraph 2 under Constructive Ownership was hard to sort through. Our accountant showed 100% for all three sibling/owners, though all the profit allocation is 1/3 for the three partners. The statement in the instructions "...an individual is considered to own an interest owned directly or indirectly by or for the individual’s family. ' made some sense in that maybe the IRS wants to cover cases where a person has effective ownership through a child or something. That said, in that section it says "...an individual won't be considered to own, under section 267(c)(2), an interest in the partnership owned, directly or indirectly, by a family member of the individual unless the individual also owns an interest in the partnership either directly or indirectly through a corporation, partnership, or trust.". So maybe this means the >100% ownership status applies in only those situations. As the partner split of the profits is unaffected, I am just going with what I have.
