Question: need A, B and C Learning Objectives: - 7.5 Differentiate between o distributive share of portnership income and cash flow - 7-6 Adjust the tax
Learning Objectives: - 7.5 Differentiate between o distributive share of portnership income and cash flow - 7-6 Adjust the tax bosis in a portnership interest Garlic, an individual, is a limited partner in Onion Parthership. This year, Garlic's share of partnership ordinary income is $20,000, and she received a cash distribution of $30,000. Garlic's tax basis in her partnership interest at the beginning of the year was $50,000. Her marginal tax rate is 22 percent. Garlic qualifies for the QBI deduction, without regard to any limitations on this QBI deduction. Required: o. Calculate the tax cost of Garlic's partnership earnings this year b. Compute Gatic's after-tax cash flow from her partnership activity this year. c. Compute Garlic's tax basis in her partnership interest at the ending of the year. Assume no change in her share of partnership liabilties during the year
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