Dissolution of LLC

[Gretel]

I try to make my questions in a previous post somewhat simpler.

If one of two partners runs away with one piece of equipment is this deemed to be a sale to the remaining partner (now a single member) or just a liquidating distribution?

[taxmandan]

If one of two partners runs away with one piece of equipment ?

I would call that theft, and file a police report. Members of an LLC can't just take stuff from the business, unless there is some sort of sale agreement, distribution of profits or incident to an agreed upon dissolution.

[Gretel]

I agree. It's between lawyers and who knows when it will be resolved. However, I need to do the final 1065.

[Gretel]

I am not giving up. By now I have decided that this is not a sale but just a liquidation of the partnership at book value. Any distributions not done in accordance with the capital accounts balances in mind (one partner should have restored his negative balance) will certainly be uncovered by the lawyers.

Any gut feeling confirmation on this?

[sea-tax]

I am not giving up. By now I have decided that this is not a sale but just a liquidation of the partnership at book value. Any distributions not done in accordance with the capital accounts balances in mind (one partner should have restored his negative balance) will certainly be uncovered by the lawyers.

Any gut feeling confirmation on this?

IMHO I would wait to file until all is sorted out. I do not think you have a liquidation or a sale, but rather a theft as Taxmandan has said. However you have not provided enough information nor could you for me to offer a valid opinion.

What does the existing partner want to do?

[Gretel]

IMHO I would wait to file until all is sorted out. I do not think you have a liquidation or a sale, but rather a theft as Taxmandan has said. However you have not provided enough information nor could you for me to offer a valid opinion.

What does the existing partner want to do?

Thanks, Seatax. Well, I have 3 posts about the same issue on the board and thought it would be easier to break the problem down a little.

There were 2 partners. One left with a piece of equipment a filed a lawsuit about issues not clear to me even after seeing the papers from the lawyer. Remaining partner continued business as single member LLC with remaining equipment and filed lawsuit for stolen equipment. If there is a dissolution remaining partner would have to restore his capital account and owe about the same amount to other partner. We are not talking big amounts here.

Final deadline for return is 4/15/07 after extension.