Why is the capital account balance on my K-1 different from the amount I invested?

Your capital account balance may differ from the amount you originally invested due to a few factors. The capital account reflects your investment activity from a tax accounting perspective — including contributions, allocations of income or loss, and any distributions. It does not always match your actual cash invested.

In particular, placement fees are excluded from your capital contributions, and any income or loss allocated during the year may change the ending balance. This is normal for partnership accounting and doesn’t impact the value of your investment or your ownership in the SPV.