topic LLC Partnership in Business & farm

LLC Partnership

Healthcaremom_ — Fri, 21 Feb 2025 23:53:46 GMT

I’m in a 50/50 LLC partnership, to start with I did not understand everything that goes along with this. When filing taxes the preparer stated that I automatically get 50% of the profit filed on my K1 since that’s how the business was created. I understand that, my business “partner” received all the income and I received ZERO. Now I am being told I HAVE to file the 50% of what he made on my schedule K form. Is this true? I am removing myself but I did not get any income and it’s confusing that I have to put income I never got on my taxes. I’m in Texas, please give me advice.

Re: LLC Partnership

JamesG1 — Sun, 23 Feb 2025 17:01:26 GMT

As a 50/50 partnership, I would expect that you would report 50% of the partnership's income on your personal income tax return.

This TurboTax Help states:

The partners report their proportionate share of the partnership’s income, losses, deductions, and credits on their own personal income tax returns. As a result, the business’s net income is ultimately taxed at each individual partner’s tax rate.

Do you have a partnership agreement that outlines how income, losses and partnership tax attributes are allocated between the partners?

Is the preparer of the partnership tax return helpful in explaining the partnership agreement to you?

Do you have access to an attorney or tax professional who can explain the partnership agreement to you?

What do you mean when you say I am removing myself? Please clarify.

Re: LLC Partnership

Healthcaremom_ — Mon, 24 Feb 2025 10:18:41 GMT

I understand the operating agreement but I didn’t receive any income from the business. All income went to the business partner as he is an owner operator. The tax preparer is his aunt, she stated I would need to change the agreement in order for me to not report the 50% income. I had to file 50% of the profit on my personal taxes when I received $0.00 the entire year. When I say remove myself, I mean change it to a single partnership, I had to put over $20,000 on my personal taxes that I never made..

Re: LLC Partnership

JamesG1 — Mon, 24 Feb 2025 18:02:46 GMT

If the partnership agreement distributes profits in the way that you explain, I hope that you are able to separate yourself from this arrangement without entanglements.

Hopefully, an attorney will assist you in withdrawing from the partnership and establishing the next business entity.