We established a new multi-member LLC on 9/1. A member passed on 10/13. Using TT Business 2020, I've added each member. I checked the small box for the deceased member that "this member left the company" in addition to "this is this member's first year". Doing this allows me to adjust the percentage ownership after 10/13 (the deceased members shares were payable on death) but TT does not allow me to enter the deceased member's initial contributions and therefore my balance sheet is off by this amount later. I cannot manually enter the starting contribution in section L of schedule K-1 for this member. What is the correct way to navigate through TT for this situation??
Well I've figured out how to make an entry on the form based on your comment ( one has to choose "override). Thanks for your help. But I feel a bit blind here. Doesn't TT guide one through this transfer of shares?
I got an entry into the member k-1 by an alternative route. I went back through the interview for that member and deselected the box for " this member left the company this year". That allowed me to establish the beginning contribution. I then edited that member again and reselected the box for "this member left the company this year". The capital contribution stayed in section L for that member's K-1.
However, TT still shows the capital contribution at the end of the year for that member's K-1. So I went into forms view and override and entered a negative value on the line for "other increase (or decrease)" for both the deceased member and the receiving member. Is this correct?? I've filed individually with TT for nearly 20 years, but this is my first year with an LLC. please advise.
Your situation as described sounds as though your multi-member LLC consisted of two members one of which deceased during the year. If this is the case, you no longer have a multi-member LLC and these issues become moot. How many members are in this LLC at year end 2020?