LLC Partnership Sold Some Assets But The Payment Received is not a 50/50 split. How to report this.

I have an llc partnership where we sold off some assets of our company however we cannot split the money we received 50/50. We sold these assets for for $32,500. Out of that amount I received $7500 and my partner received $25,000.

I'm at a loss as to how I can record this in TT Business. I was going to put it under "Cash Distributions Member Received From LLC" but on the K1 it shows up as a Distribution (19a) and I'm not sure if that is correct or not. All in all we have a 50/50 partnership however these assets sold get a different % split because they brought these assets on while merging so I'm not sure how to report it.

Any help would be great!

195

Level 15

Mar 19, 2022 1:46:05 AM

the income split can be completely different than the cash split. but this can present some significant tax issues if one partner ends up with negative basis. that additional income assuming the LLC hasn't terminated.

if its terminated, then the tax laws may require corrective allocations so one partner doesn't end up with a capital loss and the other with capital gain

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LLC Partnership Sold Some Assets But The Payment Received is not a 50/50 split. How to report this.