Refer to the facts in the preceding problem. In 2018, YZ generated $7,000 ordinary business income and

Question:

Refer to the facts in the preceding problem. In 2018, YZ generated $7,000 ordinary business income and $18,000 dividend and interest income. The partnership made no distributions. At the end of the year, YZ had $21,000 debt.

a. How much partnership income will Zelda report on her 2018 return? Assume the excess business loss limitation does not apply.

b. Compute Zelda’s adjusted basis in her YZ interest at the end of 2018.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...

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