I disagree with @AliciaP1 .
As stated previously, a guaranteed payment is determined in advance of any activity and is paid out regardless of whether there is a loss or income.
You don't pay out a guaranteed payment at the end of the year based on what the bottom line is.
Doing so and winning the IRS audit lottery will not result in a favorable audit. Plus, you don't take a tax position assuming that you don't get audited.
You don't want to have results that don't comply with how your LLC is set up.
I also explained that what you want to do must comply with very complex Section 704(b) regulations that deal with substantial economic effect. These regulations are lengthy and require numerous calculations to determine if your desired allocation comply with the regulations.
If you want to allocate income differently than 50/50, then you need to find a tax professional who can work through your desired result.
I am sure the $$ we are talking about is most likely not worth the effort of doing anything other than the 50/50 split.
As it stands now, anything other than allocating 50/50, will not be correct. You have a contract for the sold property and late fees are a part of that contract. Late fees generated by the LLC are part of the income of the LLC and should be allocated accordingly.
Individuals set up LLC's without understanding the complex nature of the entity structure and expect results different than what the tax law provides. This happens because they don't discuss the matter with a tax professional in advance and then attempt to scramble when things don't go the way they want. Unfortunately, sometimes they can't be fixed to the desired result.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
