This year, FGH Partnership generated $730,000 ordinary business income. FGH has two equal partners: Triad LLC...

This year, FGH Partnership generated $730,000 ordinary business income. FGH has two equal partners: Triad LLC and Beta, an S corporation. Triad LLC has three members: Mr. T, who owns a 45 percent interest; Mrs. U, who owns a 35 percent interest; and V Inc., which owns a 20 percent interest. Beta has 100 shares of outstanding stock, all of which are owned by Ms. B. Identify the taxpayers who must pay tax on the partnership income, and determine how much income must be reported by each.

Expert Solution

Answer

Explanation :

Given,

Since Triad LLC and Beta are two equal partners So $730,000, two equally i.e $365,000 each

Triad LLC has three members So, Triad share of profit i.e $365,000 will be divided among its member in their percent % of interest

Mr. T $365,000*45%= $164,250

Mrs. U $365,000*35%= $127,750

V Inc. $365,000*20%= $73,000

Ms. B who hold 100% shares ( Beta has one member)

Ms.B $365,000*100%= $365,000

Traid LLC & Beta will show its income as Nil .

Mr. T	$ 1,64,250
Mrs. U	$ 1,27,750
V Inc.	$ 73,000
Ms. B	$ 3,65,000
Triad LLC	NIL
Beta	NIL

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