Tax Considerations Flashcards
The PS is/isn’t a taxable entity.
Isn’t
The PS does/doesn’t have to file a tax return.
Doesn’t
What must the PS file with the IRS?
An information return.
A PS pays a single/double tax on profits.
Single
Does does a PS differ from a corporation with respect to taxation of profits?
Corp is double tax, PS is single.
If a P does not actually receive his share of PS profits in a given year, does he need to pay tax on those profits?
Yes
Each partner is responsible for paying tax on his share of PS profits whether or not they actually receive them. T or F?
True
T or F? Ps may not take their share of PS losses into account on their individual tax returns.
False, but subject to some limitations.
Since the Ps, rather than the PS itself, pay tax on the PS income, PS are often referred to as what type of entities?
Pass-through.
How does the method used to compute gain or loss of the sale of PS property differ from that which would be used by a taxable entity?
It doesn’t
Upon the sale of PS property, what tax to the PS?
None.
