Natalie is a 40% partner in the modern partnership. Her basis in her partnership interest at the start of the year is $67,000. The partnership makes guaranteed payments of $21,000 to Natalie and reports partnership income of $80,000 including the guaranteed payments deduction. The partnership distributes $11,000 cash to Natalie during the year. What is Natalie’s recognized income from the partnership and what is her basis in her partnership interest after reflecting these partnership transactions?

a) Income $21,000, her basis is $109,000

b) Income $88,000, her basis is $67,000

c) Income $53,000, her basis is $88,000

d) Income $21,000, her basis is $67,000

e) Income $32,000, her basis is $88,000

Answer rating: 100% (QA)

c Income 53000 her basis is 88000 Income 53000 her basis is 88000 ... View the full answer