How to give co-owners of a rental property a statement and split the money
A partner statement is a one-page report for each co-owner of a rental LLC showing their ownership share, their share of income and expenses for the period, the cash distributed to them and their running capital balance. Build it from the LLC's closed books: split net income by the ownership percentages in your operating agreement, subtract what you paid out, and carry the result forward. Send it on a regular schedule so nobody has to ask.
When you need one
You need a partner statement when more than one person owns the property entity: two siblings who inherited a duplex, friends who bought a building together, or a few relatives who put money into a deal you run. They are not tenants and they are not employees. They are owners, and owners expect to see what the property earned and what they got.
This is separate from raising money from the public. DoorKeeping is not an investor platform and does not help raise capital. Everything here assumes a small group of co-owners and an LLC operating agreement that you already have.
What goes on the statement
| Section | What it shows |
|---|---|
| Header | The LLC and property, the partner, their ownership percentage and the period |
| Income and expenses | Property totals for the period, then the partner's share of each |
| Net income | The partner's share of the period's profit or loss |
| Distributions | Cash paid to the partner in the period, with dates |
| Capital account | Opening balance, plus contributions, plus share of income, minus distributions, equals closing balance |
| Notes | Large one-time items, reserves held back and what comes next |
Example a made-up LLC has two partners, 60% and 40%. For the quarter, rent is $30,000 and expenses are $18,000, so net income is $12,000. The 60% partner's share is $7,200 and the 40% partner's share is $4,800, which add up to $12,000. The LLC pays out $6,000 in all: $3,600 to the first partner and $2,400 to the second. If the first partner opened the quarter with a $50,000 capital balance, it closes at $50,000 + $7,200 - $3,600 = $53,600.
Net income and cash are different numbers
A partner is taxed on their share of net income whether or not the LLC paid it out, and a partner can receive cash that is bigger or smaller than their share of income. Mortgage principal and capital improvements reduce cash but are not deducted as current expenses (improvements are depreciated over time), while depreciation reduces taxable income without using any cash. The statement should show both income and distributions so a partner is not surprised by a tax form larger than the cash they received.
A multi-member LLC is generally taxed as a partnership and files Form 1065, which reports each partner's share on a Schedule K-1. See the Instructions for Form 1065. Your tax preparer prepares the K-1s; the statements in your books are what they will rely on.
A routine that works
- Close the books for the period and reconcile the bank account.
- Decide how much cash to keep in the LLC as a reserve for repairs, taxes and insurance.
- Distribute the rest according to the operating agreement, in the ratio it states. Do not pay one partner early without a record.
- Record each distribution against the partner's capital account on the day it is paid.
- Produce one statement per partner and send them together, on the same day each period.
- Keep the operating agreement and statements together for your tax preparer.
If the agreement allows different treatment, such as preferred returns or a manager fee, follow the agreement exactly and show each step on the statement.
How DoorKeeping handles it
DoorKeeping keeps each LLC's own books, so a partner statement comes straight from the closed month: the property's totals, each partner's share by the percentages you recorded, distributions paid and a running capital balance. You can download it as a PDF or spreadsheet, or ask Claude or ChatGPT "make this quarter's statements for the Oak Court partners" and review the result before it goes out.
Distributions are paid from the LLC's own bank account. Rent and payments stay in your own bank accounts. DoorKeeping never holds your money and sends a payment only when you approve it. The price is $2 per unit a month with every feature included. DoorKeeping gives no tax or legal advice and does not prepare K-1s; your tax preparer does.
Sources
- IRS Instructions for Form 1065, read Oct 30, 2026
Questions
- What is a capital account?
- It tracks each partner's stake in dollars: what they put in, plus their share of income, minus what they took out. The operating agreement and tax rules govern the details.
- Do partners pay tax on money they did not receive?
- Generally a partner reports their share of the LLC's taxable income whether or not it was distributed. Ask your tax preparer.
- How often should partners get a statement?
- Quarterly is common for small groups, and monthly for active ones. Pick a schedule and keep it.
- Who prepares the K-1s?
- The LLC's tax preparer, from the closed books. Statements are for the partners; a K-1 is a tax form.