In each of the following separate cases, determine how much income is to be taxed to each of the taxpayers involved:

a.) Alpha Partnership is owned 60% by W and 40% by P, who agree to share profits according to their ownership ratios. For the current year, Alpha earned $12,000 in ordinary income. The partnership distribuend $3,000 to W and $2,000 to P.

b.) Beta Trust is managed by T for the benefit of B. The trust is required to distribute all income currently. For the current year, Beta Trust had net ordinary income of $5,500 and made cash distributions to B of $7,000

c.) Gamma Inc., a C corporation, is owned and operated by its two equal owners, H and K. This year the corporation, reported earned income--before any distributions to its owners---of $24,000. On May 4, the corporation declared a dividend, distributing $1,350 to H and $1,350 to K.

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Answer a A Partnership is not taxed But the share of the partners i... View the full answer