Amy and Mitchell share equally in the profits, losses, and capital of the accrual basis AM Products LLC. The LLC does not need to report financial information to any third parties, so capital accounts are determined using tax rules (rather than GAAP). Amy is a managing member of the LLC (treated as a general partner) and is a U.S. person. At the beginning of the current tax year, Amy's capital account has a balance of $692,000, and the LLC has debts of $449,800 payable to unrelated parties. The debts are recourse to the LLC, but neither of the LLC members has personally guaranteed them. Assume that all LLC debt is shared equally between the partners. The following information about AM's operations for the current year is obtained from the LLC's records. Operating income* $1,038,000 W-2 wages 200,000 Depreciation expense 300,000 Interest income 10,380 Long-term capital loss 6,920 Long-term capital gain 20,760 Charitable contribution (cash) 10,430 Cash distribution to Amy 51,900 Unadjusted basis of partnership depreciable property immediately after acquisition 1,600,000 * Operating income equals revenue less operating expenses (other than expenses listed separately above). Year-end LLC debt payable to unrelated parties is $314,860. Assume that all transactions are reflected in Amy's beginning capital and basis in the same manner. Also assume that all AM Products' activities are eligible for the qualified business income deduction. a. Calculate Amy's basis in her LLC interest at the beginning and end of the tax year. Use her capital account as a starting point. LLC interest at the beginning of the year: $fill in the blank LLC interest at the end of the year: $fill in the blank b. What income, gains, losses, and deductions does Amy report on her income tax return? If an amount is zero, enter "0". Ordinary income $fill in the blank Net long-term capital gain $fill in the blank Interest income $fill in the blank Charitable contribution deduction $fill in the blank Cash distribution $fill in the blank
Amy and Mitchell share equally in the
At the beginning of the current tax year, Amy's capital account has a balance of $692,000, and the LLC has debts of $449,800 payable to unrelated parties. The debts are recourse to the LLC, but neither of the LLC members has personally guaranteed them. Assume that all LLC debt is shared equally between the partners. The following information about AM's operations for the current year is obtained from the LLC's records.
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* Operating income equals revenue less operating expenses (other than expenses listed separately above).
Year-end LLC debt payable to unrelated parties is $314,860. Assume that all transactions are reflected in Amy's beginning capital and basis in the same manner. Also assume that all AM Products' activities are eligible for the qualified business income deduction.
a. Calculate Amy's basis in her LLC interest at the beginning and end of the tax year. Use her capital account as a starting point.
LLC interest at the beginning of the year: $fill in the blank
LLC interest at the end of the year: $fill in the blank
b. What income, gains, losses, and deductions does Amy report on her income tax return?
If an amount is zero, enter "0".
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