@jtax wrote:
if instead of the LLC ending in 2023, it had a banner year and distributed to you cash profits of $175k, you would report income of only $25k because your adjusted basis of $150k would "soak up" the first $150k....
Confounding statement and you probably should not have posted since the question had already been answered.
If the LLC had a "banner year" with a net profit (ordinary income) of $175k, the share that is reported would be based upon $175k; the distribution is irrelevant except for the basis computation.
