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N
nycpa76
Level 2
April 13, 2021
Question

Partial Sale of a partnership interest

  • April 13, 2021
  • 3 replies
  • 16 views

Partner A sells 5% of his partnership Profit and loss interest to partner B for $100 ( No hot assets at the time of sale).

How is this transaction reflected on the books of the partnership, if at all?

Thank you

This topic has been closed for replies.

3 replies

sjrcpa
sjrcpa
Level 15
April 13, 2021

Mostly it's not. Seller's proportionate share of capital sold gets transferred to buyer's capital account. Seller's ownership % on K-1 get changed.

The more I know the more I don’t know.
    N
    nycpa76Author
    Level 2
    May 10, 2021

    Would the change be included in Schedule L and a contribution and distribution in M-2?

    sjrcpa
    sjrcpa
    Level 15
    May 10, 2021

    Increase and decrease on M-2, not contribution and distribution.

    The more I know the more I don’t know.
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