LLC distribution for taxes - Spidell

LLC distribution for taxes

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Message Board LLC distribution for taxes

This topic contains 4 replies, has 0 voices, and was last updated by Tony Alvarez 11 months, 1 week ago.

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  • #33751

    I have a question regarding k1 reporting for llc entinties using accrual method reporting.  My client uses the accrual method on their financials for their taxes.  Do distributions get reported on the k1 under the accrual method or only if actual cash distrubitons are made?  Nothing has been paid out but they are billng for it and showing a payable due for distrubitons. 

  • #35453
    Lynn Freer
  • #35454
    Lynn Freer

    I believe the member will report the income as of the last day of the LLCs tax year. So if the LLC year ended 12/31/17, income would be reported on the member's 2017 return. Whether cash or accrual basis, the income is reported whether distributed or not.

    • #35458

      Thank you for your reply. 

  • #35456
    William Dewberry

    I have seen K-1 that report distributions on the accrual method, so distributions reported on the K-1 are actually paid in the following year; seems illogical to me but i have seen it. As long as you are aware of whats going on and it does not create a basis issue problem, I would think its fine.