Our LLC agreed to redeemed out 2 members on of 9/30 at the value in their capital accounts as of 9/30/2024. Their capital balance was paid in two installments, one in 2024 and one in 2025. So at the end of 2024, they still had basis in the partnership. Their ownership went from 25% (each) to 0%; while remaining members went from 25% to 50%.
Given we are cash basis accounting; I don't believe I can mark their 2024 K-1 as final. They are technically still members of the LLC with 0% interest until 2025 when the final payment is made.
Two points I would like some feedback on:
1 - Turbotax calculates a weighted average P&L allocation; I will have to manually override the K-1 balances in order to match my manual calculation (Jan-Sept P&L pro-rata to all memebers; but only Q4 P&L to remaining members)
2 - I need to note as members interest as a 'sale' occuring in 2024, but override and not mark their K-1 as final until they receive final payment
