Sharing of and right to distributions before dissolution.
Utah Code § 16-20-404
in effect16-20-404. Sharing of and right to distributions before dissolution.
(1) Any distributions made by a limited liability company before the limited liability company's dissolution and winding up must be in equal shares among members and persons dissociated as members, except to the extent necessary to comply with a transfer effective under Section 16-20-502 or charging order in effect under Section 16-20-503.
(2)
(a) A person has a right to a distribution before the dissolution and winding up of a limited liability company only if the limited liability company decides to make an interim distribution.
(b) A person's dissociation does not entitle the person to a distribution.
(3)
(a) A person does not have a right to demand or receive a distribution from a limited liability company in any form other than money.
(b) Except as otherwise provided in Subsection 16-20-708(4), a limited liability company may distribute an asset in kind only if each part of the asset is fungible with each other part and each person receives a percentage of the asset equal in value to the person's share of distributions.
(4)
(a) If a member or transferee becomes entitled to receive a distribution, the member or transferee has the status of, and is entitled to all remedies available to, a creditor of the limited liability company with respect to the distribution.
(b) However, the limited liability company's obligation to make a distribution is subject to offset for any amount owed to the limited liability company by the member or a person dissociated as a member on whose account the distribution is made.
Renumbered and Amended by Chapter 93, 2026 General Session
Source: Utah Office of Legislative Research and General Counsel (le.utah.gov)URL: https://le.utah.gov/xcode/Title16/Chapter20/16-20-S404.html?v=C16-20-S404_2026050620261001Fetched: 10/26/2026