I assume you are filing a partnership return form 1065. If your sales are less than $250,000 and assets are under $1,000,000, then you probably don't need to file a balance sheet with the return. Just check the "yes" box on line 4(d) in schedule B of form 1065.
The way the income distribution works with a partnership, you enter all of the business income and deduct all of the business expenses to arrive at your net income. You then multiply the net income by each partner's percentage of profits, and that is that partner's income or loss.
The money you contribute or take out of the partnership has little to do with your taxable income or deductible loss.
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