LLC TAX RETURN -HELP

[mohan]

I have prepared a two partners Partnership tax return for the year 2021. The LLC owned a rental property but no rental income from Jan-Aug 2021. One partner quit the Partnership and received $250,000 from the existing partner. I believe the Partnership will be closed on 05/21/2021, the agreement date. The current partner has 75%, and leaving partner has a 25% profit sharing ratio.

As per the Balance sheet, I did not see any basis for the leaving partner. The only balance sheet item is the historical cost of the building and the same amount of non-recourse loan. The existing partner's basis is a non-recourse loan and leaving partner basis. Maybe the property needs to be revalued at FMV. Is it mandatory for partnership business or not necessary?

I have prepared but am not sure about the correctness. If someone helps me to review and provide guidance. I will pay for your service. If you have experience preparing the same tax return before, please help me and let me know the associated cost.

[sjrcpa]

You've got a final 1065 with a year ended 5/31/21. It is late.

From 6/1/21 the activity is reported on  the remaining owners 1040.

If remaining partner paid departing partner $250,000, that is an indication of what the 25% he bought is worth.

[mohan]

Thanks. I thought that, but i am not sure about basis calculation.

Is the basis calculation of the departing partner's responsibility on partnership or departing partner himself? Because, I don't have enough information for the basis.

[sjrcpa · Accepted solution]

Basis in the partnership is the partner's responsibility.

[mohan]

Thank you so much.

[sjrcpa]

You're welcome.