cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Level 1

Partner distribution

I have an annual client that will close operations and they gave me an order to register the expenses as distribution
Would you make a partner distribution account for each partner?
would it be a capital account?
Could it be negative on the balance sheet?
I don't know how to handle this, I'm confused

1 Comment
Highlighted
Level 15

Partner distribution

they are wrong

 

you enter all expense just as you always would, then you do a final tax return closing the partnership, that return will create a K-1 per partner showing his share of the total income and expense.

 

you close all sub equity account to equity and write a check to cover that amount as an equity draw.  That will zero out the equity for each partner

 

Be sure to payoff all debts first, especially sales tax payable.

Need to get in touch?

Contact us