TAXES FOR LLC SEARCH FUND RE INVESTORS

Anyone have thoughts at least from a high level on how the search fund should report taxes during a year of searching before finding a deal? Do the investors take advantage of the losses/expenses and lower their basis, then take cap gains if there is a successful acquisition on the difference of the new lower basis and the step-up? .....Or do you just delay until the end of the fund and either take the loss if unsuccessful or cap gains on the step-up if successful?

Thanks for your thoughts in advance!



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