Just trying to make sure my accountant is handling correctly.
Multi-member LLC, started 2020 with 6 owners. Two of us did an internal buyout (the company bought the interests of the 4 other partners and redistributed them to the remaining 2, including myself). So for January - April 2020, there were 6 partners, and for May - December, there were 2.
My accountant pro-rated the P&L correctly and we have K1s ready to go for the four former partners that show their tax liability pro-rated to their ownership for January - April. However, the buyout payment we made to them (which came from the company... though in the end I guess it really came from myself and my partner considering LLCs are pass-thru) isn't mentioned anywhere on the K1. Do we need to issue a 1099-misc for the buyout payment? Or is that something they just need to self-report?
To throw a wrench into the fire, the buyout payment was actually split into two. They got the first half last May, and they'll get the second half *this* May. So we'll have to report again somehow (if necessary) for 2021.
