I understand that profit/loss is distributed among the LLC owners according to their ownership stakes.
What about if profit/loss if the ownership stakes change? Say for example, there are 3 owners, each with 1/3 share. Starting July 1st, the stakes change so that 2 owners have 25% each and one owner has 50%.
At the end of the year it turns out that the company had a loss of $10,000. How is this loss distributed on the K1 form, given that the change in ownership stakes occurred mid-year?
Thank your any input.