R4: Partnership Taxation

Question 1

Items not deductible on Schedule K:

Answer 1

"IFC 179"
Investment interest expense
Foreign tax paid
Charitable contributions
179 expense

Question 2

Requirement for partnership termination:

Answer 2

50% or more interest must change hands within 12 months

Question 3

How do liabilities affect partner basis?

Answer 3

Own partner liabilities reduce basis.

Partnership/recourse liabilities increase basis

Question 4

Items not counted as income on Schedule K:

Answer 4

“PP1231”
Passive income
Portfolio income
1231 gains/losses

Question 5

Partnership Basis Calculation

Answer 5

Beginning partnership basis
\+ capital contributions
\+ share of ordinary income
\+ capital gains
\+ tax-exempt income
= ending partnership basis