R4 - Partnership Taxation

Question 1

How are guaranteed payments treated?

Answer 1

Taxable income to the partner and tax deductible to the partnership

Question 2

How long is the extension for a 1065?

Answer 2

5 months (September 15)

Question 3

How is a partner’s basis calculated?

Answer 3

Capital account + % of liabilities

Question 4

How long is a partner’s loss in excess of basis carried forward?

Answer 4

Indefinitely

Question 5

When is a gain recognized in the liquidating distribution of a partnership?

Answer 5

When money received exceeds the partner’s basis

Question 6

T/F: A partnership terminates when 50% or more of its interests change hands within 12 months

Answer 6

True

Question 7

In a liquidating distribution of a partnership, how is basis in assets calculated?

Answer 7

Partnership interest - cash received = basis in assets received

Question 8

When an ownership interest is given in exchange for services, which value of the partnership is used to determine the ordinary income for the partner, NBV or FMV?

Answer 8

FMV

Question 9

T/F: The holding period of a partnership interest acquired in exchange for a contributed capital asset begins on the date the partner’s holding period of the capital asset began

Answer 9

True