I agree, it shouldn't affect the capital balance, but the entry automatically causes the capital balance to change in Turbo Tax. The schedule L and schedule M-1 show the correct balance sheet amounts, including Partner's Capital accounts, but Schedule M-2 shows an increase in the Capital accounts by the amount of the easement. The Capital Balance in M-2 is higher than the capital balance that appears on Schedule L. But in the step by step instructions, the instructions say the tax and book partner capital accounts match what is on M-1.
Maybe I saw the wrong information for reporting the 1099S on the LLC's Business return. Can you tell me how to report the 1099S for the land easement?
