JLK Partnership is an electing large partnership with 100 partners. The partnership reports the following operating results from the current year:
Ordinary income................................................$2,000,000
Net Sec. 1231 gain...................................................250,000
Tax-exempt interest income..................................100,000
Net long-term capital gain......................................150,000
Charitable contributions.........................................200,000
Miscellaneous itemized deductions.........................50,000
None of JLK’s activities is passive. During the year, JLK distributed $5,000 to each of its partners.
a. What income, gains, losses, and deductions must the JLK Partnership report to each of its partners?
b. How are the items from Part a reported by JLK’s partners?