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What happened to the deceased member's interest? Presumably it went to his estate until the estate process was wrapped up, so yes you still have a partnership. K-1s to living member, deceased member for period he was alive, and deceased member's estate for rest of year.
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I think the partnership ended on the date of death of the partner... And then it is a sole proprietorship after the day of death.. I may be wrong but that is my opinion...
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What happened to the deceased member's interest? Presumably it went to his estate until the estate process was wrapped up, so yes you still have a partnership. K-1s to living member, deceased member for period he was alive, and deceased member's estate for rest of year.
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@sjrcpa I thought a 50% or more change in Partners technically would end a partnership but that must be wrong...
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That used to be the rule. It was called a technical termination. There is no longer such a rule.
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I do not think the LLC is effective. It is not a partnership.
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You are talking about a LLC not a partnership. The benefit of an LLC is that it is not a partnership.
The individual is not a partner. He She is a MEMBER.
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I sont think you are wrong. A LLC is not a partnership. It elects to be taxed as a partnereship.
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@sjrcpa thank you for the information...
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Just another example of how people who are sold an LLC may have no idea what they're buying.
https://businesslawtoday.org/2019/07/sole-members-death-modest-proposal/
https://businesslawtoday.org/2020/01/death-llc-member-part-ii/
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@Albert-1 Yes everyone knows that the owner of an LLC is a MEMBER.... I believe Satch refered to him as a partner because it is being taxed as a partnership... The last time I checked the K-1 that an individual receives from a LLC taxed as a partnership is called the PARTNERS share of income, deductions, credits Etc...
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Thank you . I greatly appreciate your input .
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Good article from Tax Adviser "A two-person partnership does not terminate upon a partner's death if the deceased partner's successor in interest (usually the estate) continues to share in the partnership's profits or losses (Regs. Sec. 1.708-1(b)(1)(I)). The partnership's tax year does not close, and the partner's distributive share of partnership income from the date of death through the end of the partnership tax year is reported on the tax return of the successor in interest (Regs. Sec. 1.706-1(a)). Likewise, if a partnership begins or continues to make liquidating payments to a deceased partner's successor in interest under the provisions of Sec. 736, the successor in interest is treated as a partner until the deceased partner's interest in the partnership has been completely liquidated (Regs. Sec. 1.736-1(a)(1)(ii)). In a two-person partnership, the partnership does not terminate, nor does the partnership year end (other than the partnership's normal tax year), until the final liquidating payment is made to the successor in interest (Regs. Sec. 1.736-1(a)(6))."
Here is link: https://www.thetaxadviser.com/issues/2015/aug/accounting-for-death-of-partner.html
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No it doesn't elect to be taxed as a partnership. A multimember LLC's default classification for tax purposes is Partnership. It may elect to be taxed as a Corporation.
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sjrcpa is hitting home runs...⚾️