Hello Quickbooks Community,

Please help with a question.

Does the IRS consider this a distribution?

Our partnership LLC had a large amount of retained earnings. It was decided to distribute the money to the members in proportion to percentage ownerships. However, all members wanted to leave their newfound wealth in the LLC. So, the money was simply debited from the retained earnings account and credited to the member’s Capital Accounts. No money left the LLC.

Does the IRS consider it a distribution?

Thank you for your help,

Steve F.