What are the rules for reporting transfers between the LLC and its members, and which schedule should be attached to Form 568?
Transfers between an LLC and its members are reported on Schedule L (Member's Capital Accounts) of Form 568. These transfers include contributions, withdrawals, and transfers in exchange for services. The LLC reports the transaction on its own tax return, and the member reports the transaction on their personal tax return using Form 1041 for partnership taxation or Form 1120 for corporate taxation. The LLC also reports the transaction on Schedule M-1 (Reconciliation of Income and Deductions) of Form 568.