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    Bizcoach70's Avatar
    Bizcoach70 Posts: 7, Reputation: 1
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    #1

    Jan 26, 2017, 09:35 AM
    Accounting Question
    Need help with accounting entries please.RE: A 2 member LLC taxed as an S Corp. Member 1 owns 75%, Member 2 owns 25%.Effective 1-1-17 the LLC is purchasing Member 2's 25% for $45000. The contract states that The LLC is purchasing all of Member 2's equity including retained earnings.On 1-1-2017 the co shows 34000 RE on the balance sheet. $8500 of this RE pertains to member 2. It was included on his K1 for year 2016 as earnings. Member 2 would like to avoid having the 8500 increase his basis in the equity to minimize his tax on the gain .Is this journal voucher OK?Debit RE 8500Debit Members Equity 36500Credit Cash 45000The goal for member 2 is to minimize his cost basis while keeping the LLC's books correct.Please respond with comments.Thanks for your help.
    Missouri Bound's Avatar
    Missouri Bound Posts: 1,532, Reputation: 94
    Ultra Member
    		  
    #2

    Jan 30, 2017, 08:20 PM
    Who usually does your homework for you?
    Cat1864's Avatar
    Cat1864 Posts: 8,007, Reputation: 3687
    Marriage Expert
    		  
    #3

    Jan 31, 2017, 12:43 PM
    If this is a homework question, please show your work and/or explain where you are having problems. It is site policy to give help instead of giving answers.

    If this is for work, could you break up the paragraph to make it easier to follow.

    Thank, you.
    joypulv's Avatar
    joypulv Posts: 21,591, Reputation: 2941
    current pert
    		  
    #4

    Feb 13, 2017, 03:10 PM
    I don't think this is homework. I think OP charges for business advice and then gets the answers he needs online, free if possible. (He asked more about this scenario today, 2/13)
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