The outside basis is defined in the internal revenue code as a partner's basis in the partnership interest. True False
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The outside basis is defined in the internal revenue code as a partner's basis in the
| True | |
| False |
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- Can a partnership assume liabilities as part of one of the partners contributions?What types of bases for dividing partnership net income or net loss are available?Why are both non-taxable income and non-deductible expenses received and incurred at the partnership level taken into account in determining the basis of the partner? Give an example to Prove your answer.
- Distinguish between “withdrawals” and “salaries” in accounting for partnership.What are the allowable deductions to a General Professional Partnership? Thank you!When the partnership agreement specifically provides for salaries and interest, the provision must be applied before the remainder of profit or loss is divided True False
- According to the Uniform Partnership Act, what events should occur if a partner incurs a negative capital balance during the liquidation process?The following are rights of a partner in a partnership, except one: Right to compensation Right to information Right to return of capital Right to agencyA general partnership, unlike a limited partnership, is an entity that legally functions separate and apart from its owners. True False
- List the instances when a partnership is terminated.Which of the following is an element of the requirement that partnership allocations must have substantial economic effect? If an allocation of income, loss, or deduction is made for tax purposes, a similar allocation must be made for partnership book purposes so the partner's capital account (and rights to partnership capital) reflect a corresponding increase or decrease. Liquidations must be made in accordance with partner's capital accounts and a partner with a negative capital account must have the obligation to restore the capital account deficit in case of liquidation. Even if corresponding allocations are made for tax purposes and book purposes, those allocations must be made for economic reasons independent of minimizing taxes based on the partners' individual tax situations. All of these are elements of substantial economic effectAccording to the provisions within the Uniform Partnership Act, in which of the following instances would a general partnership be treated as a separate legal entity from its partners a. partner's limited liability to partnership assets b. partners to be treated as employees of the partnership Oc. Partnership payment of income taxes on partnership income. Cd. Partnership acquiring title and ownership of property