1) Yes, the expenses paid from the LLC bank account get deducted from the profits before the 50% owner split.
2) The individual expenses you have two options. One you can have the company reimburse you for the expenses and then report the expenses on the tax return for the company before the 50% owner split.
The other option is when you report the K-1 on your personal return you each take the expenses you individually paid for as Unreimbursed Partnership Expenses which then only reduces your split of the company profits for the expenses you personally paid.
To take the Unreimbursed Partnership Expenses as you put in your information for your K-1 the program takes you to a screen titles Describe the Partnership mark the first box on this screen with the description I am required to pay supplemental business expenses on behalf of this partnerhip/LLC for which I am not reimbursed.
Then the program will take through a number of screens to enter the information about your expenses for the business.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
