Let's assume that there are 4 partners that share profits/losses equally and the partnership earns a profit
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Let's assume that there are 4 partners that share profits/losses equally and the partnership earns a profit of $100,000. Let's also assume that each partner withdrew $10,000. When the partnership files the tax return (Form 1065), the partnership will not pay tax. Each partner will receive a Schedule K-1 showing $25,000 in profit and $10,000 is withdrawals (distributions).
Will each partner part the same amount of tax on the profit? Does the $10,000 impact each partner's personal taxable?
Related Book For
Accounting Principles Volume 2
ISBN: 9781119786634
9th Canadian Edition
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak
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