Question 1

Guaranteed payments are always determined with regard to partnership income.

Accepted Answer

A) True 
 B)False

Question 2

Partner Tami (a 20% partner)had the following items reported to her on a partnership Schedule K-1:   Tami had a basis in her partnership interest of $14,000 at the beginning of the year.Additionally,the partnership has recourse liabilities of $100,000 outstanding at the end of the year.What is Tami's basis in her partnership interest at the end of the year?

Accepted Answer

A)  $7,000. 
B)  $11,200. 
C)  $23,200. 
D)  $31,200. 
A)  $7,000. 
B)  $11,200. 
C)  $23,200. 
D)  $31,200.

Question 3

If only cash is contributed on the formation of a partnership,outside basis will equal inside basis.

Accepted Answer

A) True 
 B)False

Question 4

Lacy contributes the following assets to a partnership for a 25% interest:   The land and the van have a basis to the partnership of:

Accepted Answer

A)  Land $0; Van $0. 
B)  Land $15,000; Van $10,000. 
C)  Land $15,000; Van $15,000. 
D)  Land $50,000; Van $15,000. 
A)  Land $0; Van $0. 
B)  Land $15,000; Van $10,000. 
C)  Land $15,000; Van $15,000. 
D)  Land $50,000; Van $15,000.

Question 5

As a general rule,a distribution to a partner from a partnership is treated as:

Accepted Answer

A)  A guaranteed payment. 
B)  A reduction in basis,and no gain or loss is recognized. 
C)  Ordinary income. 
D)  A capital gain distribution. 
A)  A guaranteed payment. 
B)  A reduction in basis,and no gain or loss is recognized. 
C)  Ordinary income. 
D)  A capital gain distribution.

Question 6

Anna has a $25,000 basis in her partnership interest when she receives liquidating distributions from the partnership.Anna receives cash of $18,000 and computer equipment with a basis to the partnership of $15,000.What are the tax consequences of the liquidating distributions to Anna?

Accepted Answer

Anna recognizes no gain or los

Question 7

Callie contributes the following assets to a partnership in exchange for a 30% partnership interest:   What is Callie's beginning basis in her partnership interest?

Accepted Answer

The answer of Callie contributes the following assets to a...

Question 8

Which of the following is reported as ordinary income or expense from a partnership?

Accepted Answer

A)  Depreciation expense. 
B)  Section 179 expense. 
C)  Gain on the sale of a Section 1231 asset. 
D)  Dividend income. 
A)  Depreciation expense. 
B)  Section 179 expense. 
C)  Gain on the sale of a Section 1231 asset. 
D)  Dividend income.

Question 9

A partner's basis in his or her partnership interest (outside basis)is the sum of the money contributed plus the adjusted basis of property contributed.

Accepted Answer

A) True 
 B)False

Question 10

Ordinary income from a partnership is not considered self-employment income.

Accepted Answer

A) True 
 B)False

Question 11

The sale of a partnership interest is similar to the sale of any capital asset and is reported by the partner on Schedule D of his or her individual tax return.

Accepted Answer

A) True 
 B)False

Question 12

All income/gain and expense/loss items affect a partner's basis in his or her partnership interest.

Accepted Answer

A) True 
 B)False

Question 13

A partner had the following items reported on a partnership Schedule K-1:   The partner's self-employment income for the year is:

Accepted Answer

A)  $26,000. 
B)  $32,500. 
C)  $48,500. 
D)  $64,500. 
A)  $26,000. 
B)  $32,500. 
C)  $48,500. 
D)  $64,500.

Question 14

Charley is a partner in Charley,Austin,Liz & Bass Partnership.Charley owned 25% from January 1,2014 to April 1,2014 when he bought both Liz's 25% and Bass's 25% interests.He owned 75% for the rest of the year.The partnership had ordinary income of $358,000 and $12,000 in long-term capital gains.Barring any special allocations in a partnership agreement,what is Charley's share of income (assume a 365-day year)?

Accepted Answer

The answer of Charley is a partner in Charley,Austin,Liz &...

Question 15

Guaranteed payments are the only items that are reported both as a deduction for ordinary income and as a separately stated item.

Accepted Answer

A) True 
 B)False

Guaranteed payments are always determined with regard to partnership income.

If only cash is contributed on the formation of a partnership,outside basis will equal inside basis.

Lacy contributes the following assets to a partnership for a 25% interest: The land and the van have a basis to the partnership of:

As a general rule,a distribution to a partner from a partnership is treated as:

Anna has a $25,000 basis in her partnership interest when she receives liquidating distributions from the partnership.Anna receives cash of $18,000 and computer equipment with a basis to the partnership of $15,000.What are the tax consequences of the liquidating distributions to Anna?

Callie contributes the following assets to a partnership in exchange for a 30% partnership interest: What is Callie's beginning basis in her partnership interest?

Which of the following is reported as ordinary income or expense from a partnership?

A partner's basis in his or her partnership interest (outside basis)is the sum of the money contributed plus the adjusted basis of property contributed.

Ordinary income from a partnership is not considered self-employment income.

The sale of a partnership interest is similar to the sale of any capital asset and is reported by the partner on Schedule D of his or her individual tax return.

All income/gain and expense/loss items affect a partner's basis in his or her partnership interest.

A partner had the following items reported on a partnership Schedule K-1: The partner's self-employment income for the year is:

Guaranteed payments are the only items that are reported both as a deduction for ordinary income and as a separately stated item.

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, Forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Adjustments for Adjusted Gross Income

Itemized Deductions

Self-Employed Business Income

Capital Gains and Other Sales of Property

Rental Property, Royalties, and Income From Flow-Through Entities

Tax Credits

Payroll Taxes

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Corporate Taxation

Filters

Exam 14: Partnership Taxation

Guaranteed payments are always determined with regard to partnership income.

If only cash is contributed on the formation of a partnership,outside basis will equal inside basis.

Lacy contributes the following assets to a partnership for a 25% interest: The land and the van have a basis to the partnership of:

As a general rule,a distribution to a partner from a partnership is treated as:

Anna has a $25,000 basis in her partnership interest when she receives liquidating distributions from the partnership.Anna receives cash of $18,000 and computer equipment with a basis to the partnership of $15,000.What are the tax consequences of the liquidating distributions to Anna?

Callie contributes the following assets to a partnership in exchange for a 30% partnership interest: What is Callie's beginning basis in her partnership interest?

Which of the following is reported as ordinary income or expense from a partnership?

A partner's basis in his or her partnership interest (outside basis)is the sum of the money contributed plus the adjusted basis of property contributed.

Ordinary income from a partnership is not considered self-employment income.

The sale of a partnership interest is similar to the sale of any capital asset and is reported by the partner on Schedule D of his or her individual tax return.

All income/gain and expense/loss items affect a partner's basis in his or her partnership interest.

A partner had the following items reported on a partnership Schedule K-1: The partner's self-employment income for the year is:

Guaranteed payments are the only items that are reported both as a deduction for ordinary income and as a separately stated item.

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, Forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Adjustments for Adjusted Gross Income

Itemized Deductions

Self-Employed Business Income

Capital Gains and Other Sales of Property

Rental Property, Royalties, and Income From Flow-Through Entities

Tax Credits

Payroll Taxes

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Corporate Taxation

Filters