The character of a partner's distributive share of a partnership item of income, gain, loss, credit,...

The character of a partner's distributive share of a partnership item of income, gain, loss, credit, or deduction that the partner must take into account separately is determined as if the partner had realized it directly from the same source or incurred it in the same manner as it was realized or incurred by the partnership.

		False.
		True.

Solutions

Expert Solution

the following explaination will give you clarity about there distributive shares

Generally, the partnership agreement determines a partner's distributive share of any item or class of items of income, gain, loss, deduction, or credit. The allocations provided for in the partnership agreement or any modification will be disregarded if they do not have substantial economic effect. If an allocation does not have substantial economic effect or the partnership agreement does not provide for the allocation, the partner's distributive share of the partnership items is determined by the partner's interest in the partnership.

Substantial economic effect. An allocation has substantial economic effect if both of the following tests are met.

There is a reasonable possibility that the allocation will substantially affect the dollar amount of the partners' shares of partnership income or loss independently of tax consequences.
The partner to whom the allocation is made actually receives the economic benefit or bears the economic burden corresponding to that allocation.

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Determine the realized and recognized gain or loss and the character of the gain or loss....

Determine the realized and recognized gain or loss and the character of the gain or loss. 1. Emilio and Charita own stock in Software Corporation. They purchased 1,000 shares for $20 per share in July 2006. They paid $400 in brokerage commissions. On July 21, 2013, Software Corporation distributed a 2-for-1 stock split. The fair market value at the time of the split was $100 per share. 2. On July 21, 2008, Emelio's father gave him 100 shares of stock...

A. This year, Darrel’s distributive share from Alcove Partnership includes $5,000 of interest income, $2,000 of...

A. This year, Darrel’s distributive share from Alcove Partnership includes $5,000 of interest income, $2,000 of dividend income, and $70,000 ordinary business income. Assume that Darrel materially participates in the partnership. How much of his distributive share from Alcove Partnership is potentially subject to the net investment income tax? B. This year, Darrel’s distributive share from Alcove Partnership includes $5,000 of interest income, $2,000 of dividend income, and $70,000 ordinary business income. Assume that Darrel does not materially participate in...

Section 721 provides that, in general, no gain or loss is recognized by the partnership or...

Section 721 provides that, in general, no gain or loss is recognized by the partnership or the partner on contribution of appreciated or depreciated property to a partnership in exchange for an interest in the partnership. True False All costs of organizing a partnership cannot be deducted in the year in which the partnership begins business. True False

Comprehensive Income Total Impact on NI Realized Gain/Loss Unrealized Gain/Loss Total Impact...

Comprehensive Income Total Impact on NI Realized Gain/Loss Unrealized Gain/Loss Total Impact on CI Section III - Income Taxes (45 points) - XYZ began business on 1/1/18. During that year, they had pre-tax financial accounting income of$96,000 and paid $800 of officer life insurance (company is the beneficiary). The accountant has determined that a truck purchased in 2018 for $25,000 will be depreciated as follows: 2018 2019 2020 2021 2022 Financial Statement $5,000...

Problem 12-6A Liquidation of a partnership LO P5 Kendra, Cogley, and Mei share income and loss...

Problem 12-6A Liquidation of a partnership LO P5 Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows. KENDRA, COGLEY, AND MEI Balance Sheet May 31 Assets Liabilities and Equity Cash $ 103,900 Accounts payable $ 258,000 Inventory 537,600 Kendra, Capital 76,700 Cogley, Capital 172,575 Mei, Capital 134,225 Total assets $ 641,500 Total liabilities and equity $ 641,500...

Problem 12-6A Liquidation of a partnership LO P5 Kendra, Cogley, and Mei share income and loss...

Problem 12-6A Liquidation of a partnership LO P5 Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows. KENDRA, COGLEY, AND MEI Balance Sheet May 31 Assets Liabilities and Equity Cash $ 93,400 Accounts payable $ 247,000 Inventory 537,600 Kendra, Capital 76,800 Cogley, Capital 172,800 Mei, Capital 134,400 Total assets $ 631,000 Total liabilities and equity $ 631,000...

Problem 12-6A Liquidation of a partnership LO P5 Kendra, Cogley, and Mei share income and loss...

Problem 12-6A Liquidation of a partnership LO P5 Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows. KENDRA, COGLEY, AND MEI Balance Sheet May 31 Assets Liabilities and Equity Cash $ 84,800 Accounts payable $ 252,000 Inventory 538,200 Kendra, Capital 74,200 Cogley, Capital 166,950 Mei, Capital 129,850 Total assets $ 623,000 Total liabilities and equity $ 623,000...

1. Either the translation gain (or loss) or the gain (or loss) resulting from a hedge...

1. Either the translation gain (or loss) or the gain (or loss) resulting from a hedge strategy is a real gain (or loss). a. True b. False 2. If a firm does not have foreign subsidiaries, it is not subject to ______. a. transaction exposure b. economic exposure c. translation exposure d. A and B e. A and C 3. A U.S. company with sales to Canada amounting to C$6 million. Its cost of materials attributable to the purchase of...

What is the difference between a realized gain/loss and an unrealized gain/loss? Response must be at...

What is the difference between a realized gain/loss and an unrealized gain/loss? Response must be at least 150 words.

1. in the absence of a partnership agreement, the law says that income and loss should...

1. in the absence of a partnership agreement, the law says that income and loss should be allocated a. based on their length of time with the partnership b. equally c. according to their capital investments d. based on salary allowances 2. the number of shares that a corporations charter allows it to sell is referred to as a. authorized stock b. outstanding stock c. issued stock d. common stock 3. shamrock company had a net income of $30,000. the...

Subjects