Sam and Tom each own 50% of the ST partnership. ST partnership uses a calendar year. On
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Sam and Tom each own 50% of the ST partnership. ST partnership uses a calendar year. On June 30th, Sam sells ½ of his partnership interest (25%) to Paul. After the sale, the partnership ownership is Sam 25%. Tom 50% and Paul 25%. For the calendar year, ST partnership earns $10,000 a month January-August and $20,000 per month September-December.
a) What are the 2 methods to calculate the income of Sam and Paul for the year? What are the differences in the 2 methods?
b) Compute the income to be allocated to Sam and Paul for the year using both methods.
Related Book For
Federal Taxation 2018 Corporations, Partnerships, Estates & Trusts
ISBN: 9780134550923
31st Edition
Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson
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