Question

The deduction for a contribution to a retirement plan for an owner of a sole proprietorship is not taken on Schedule C.

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False

Question 6

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Assuming Lee owns a dog grooming business, which is a sole proprietorship, and he has net self employment income of $100,000 and he pays SE tax of $16,000 (assumed), the most that he can contribute to a Keogh plan is $25,000.

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Question 7

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Assuming Fred owns a fire arms training business, which is a sole proprietorship, and he has net self employment income of $140,000 and he pays SE tax of $20,000 (assumed), the most that he can contribute to a Keogh plan is $26,000.

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Question 8

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Partnerships can have special allocations in which income is allocated disproportionately to ownership

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False

Question 9

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A family limited partnership generally separates the value of the business equally between the general partner(s) and the limited partners.

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Question 10

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One of the benefits of a FLP is that transfers of the limited partnership interests can be completed at a substantial valuation discount.

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False

Answer 1

The deduction for a contribution to a retirement plan for an owner of a sole proprietorship is not taken on Schedule C

This is FALSE

The deduction is actually taken on Schedule C.

Assuming Lee owns a dog grooming business, which is a sole proprietorship, and he has net self employment income of $100,000 and he pays SE tax of $16,000 (assumed), the most that he can contribute to a Keogh plan is $25,000.

This FALSE

The amount $ 25,000 is incorrect.

Assuming Fred owns a fire arms training business, which is a sole proprietorship, and he has net self employment income of $140,000 and he pays SE tax of $20,000 (assumed), the most that he can contribute to a Keogh plan is $26,000.

This is TRUE

The most he can contribute to a Keogh plan is $26,000 as per the provisions of the law.

Partnerships can have special allocations in which income is allocated disproportionately to ownership

This is FALSE

No partnerships cannot have special allocations in which income is allocated DISPROPORTIONATELY.

A family limited partnership generally separates the value of the business equally between the general partner(s) and the limited partners

This is FALSE

A family limited partnership DOES NOT separate the value of the business equally between general partners and limited partners.

One of the benefits of a FLP is that transfers of the limited partnership interests can be completed at a substantial valuation discount

This is TRUE