Amy and Mitchell share equally $(50\%)$ in the profits, losses, and capital of the accrual basis AM Products LLC$.$ 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$$s tax basis capital account has a balance of $$300,000,$ and the LLC has debts of $$200,000$ payable to unrelated parties. All debts are recourse to the LLC$,$ but neither of the LLC members has personally guaranteed them. The following information about AM$$s operations for the current year is obtained from the LLC$$s records.

Sales revenues $$1,400,000$

Other $$ordinary and necessary$$ operating expenses $($e$.$g$.,$ utilities, repairs, and rent$)500,000$

W$2$ wages to employees $200,000$

Depreciation expense $300,000$

Interest income $4,000$

Long$-$term capital gain $6,000$

Charitable contribution $($cash$)4,000$

Cash distribution to Amy $20,000$

Unadjusted basis of partnership property immediately after acquisition $1,600,000$

Year$-$end LLC debt payable to unrelated parties is $$140,000.$ All transactions are reflected in Amy$$s beginning capital account and tax basis in the same manner. All AM Products$$ activities are eligible for the qualified business income deduction.

Calculate Amy$$s tax basis in her LLC interest at the beginning and end of the tax year. Use her capital account as a starting point.

What income, gains, losses, and deductions does Amy report on her income tax return?

What other calculations is Amy required to make?

Prepare Amy$$s tax basis capital account roll forward from the beginning to the end of the tax year. How does her ending capital account differ from her ending tax basis in the LLC interest as calculated in part $($a$)?$