Partner's Final K1 Capital account zero?
Partner B is out of LLC as of 01/01/10 (or 12/31/09), as I have been told this is his "final K1".
Do I need to zero out his negative capital account and distribute it to the other partners on the '09 return. Or do I make an adjustment in '10?
'09 was first year of business, each partner contributed capital only as "loans" and the company had a loss, so all capital accounts are negative. Partner A & C will repay loan to Partner B. No distributions or exchange of money or property, etc.
I am also uncomfortable that the K1 shows that Partner B has a 33% share of liabilities at the end of year, even though I have him at 0% ending in Proseries (but 33% in the Intl/Fnl% column). Do I need to reallocate that to the other partners as well? If so, how? Doesn't seem to be easy override in ProSeries.
Any help appreciated. Thanks.