Business partner using funds for personal spending

[KC10]

I am an equal partner and found the other shareholder is spending thousands of dollars on buying lunches for everyone even after asked to stop as this was not agreed upon.  How does this affect my profits and distributions? And do they need to reimburse the company? 

[IRonMaN]

"even after asked to stop as this was not agreed upon"

Sounds like it is time for a divorce.

[abctax55]

1) Talk to an attorney (rather than anonymous folks on a public forum) as this is a legal issue.

2) 'partner' and 'shareholder' are not synonyms.   Different entities.

[qbteachmt]

You seem to be lost on the internet. This is a Software and Tax Prep community. Not legal guidance or even personal tax guidance.

You’ve come to a Peer User community for Intuit Income Tax Preparation products supporting tax preparation professionals using ProSeries, Proconnect and Lacerte Tax Preparation programs.

If you're looking for professional guidance, then tell the person they are stealing a corporate asset (money) and it concerns you, personally. Additionally, as the other, and an equal, shareholder you are entitled to distribute an equal amount to yourself as what they are spending as if the corporation is their own piggy bank. A lot of people have the misconception that spending from the Company makes the expenditure a business expense, which is not how business is done. It doesn't affect profit. It affects available Cash, and for all you know, the person has been spending amounts which draw your operating account down, even to the point of spending employees' tax withholding, which makes this illegal as Federal payroll tax theft. Worse yet, if your entity has trust account requirements, for all you know, they are spending down these funds, as well. That entitles them to nice jewelry = an ankle monitor.

If you really have a Tax question, visit the TurboTax Help site for support. And try this screen, for the various topics (subforums): https://ttlc.intuit.com/community/discussions/discussion/03/302

Your sign in user info here is the same one you can use over at the TurboTax forum.

Thanks.