Problem
A partner in the LLC wants to sell his interest to person S for 100,000. His tax basis in LLC is 135,000. Here are some other facts:
LLC total debt outstanding 105,000 LLC is a cash basis business
LLC receviables from sales to customers 60,000
LLC other tangible assets FMV 300,000 Tax basis 150,000
Every partner afrees that going concern value of LLC is 30,000
How to report this transaction for seller partner?
What's buyer S's initial tax basis in LLC?