Free

Partnership taxation - Assignment Example

Comments (0) Cite this document
Summary
A Pays $50,000 cash, B pays equipment with a basis of $15,000 and a FMV of $30,000 and C pays land with a basis of $25,000 and a FMV of $35,000. Soon after contributions, Balance Sheet would display the following with an assumption that…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER93.7% of users find it useful
Partnership taxation
Read TextPreview

Extract of sample "Partnership taxation"

PARTNERSHIP TAXATION: Federal Taxation of Partnerships I (a). What are the tax consequences to A, B & C and the partnership from these contributions? Include in your response:
Any income/loss recognition by partners and partnership
What each partners outside basis will be and
What the partnerships inside basis will be in each asset
Answers
A, B, C are of equal partnership in ABC. A Pays $50,000 cash, B pays equipment with a basis of $15,000 and a FMV of $30,000 and C pays land with a basis of $25,000 and a FMV of $35,000. Soon after contributions, Balance Sheet would display the following with an assumption that ABC has zero liabilities at the time it is formed:
All Assets basis 90,000 dollars and it shows the contributed assets in the partnerships ownership. This is inside basis of ABC partnerships. All Assets Value add up to 115,000 dollars and this signifies partnership assets book value.
The entire Basis is 90,000 dollars and this signifies the tax capital accounts of partners outside basis of contributed properties. Entire book capital adds up to $115,000 and this denotes that the book capital account of partners. Book capital accounts mirror partners’ equal rights and contributions to every liquidation distributions (Larson, 2013)
Increases
Every partner external basis will be
A-$20000
B-$5000
C-$10000
Entire partners’ external basis is $35000
Partners inside basis in every asset
Cash-$20000
Inventory-$5000
Office furniture-$10000
(b). what are A, B and C’s holding periods in their partnership interests?
Answer

A: B: C=20:5:10
That means that the holding period should be according to the way they share their interest.
Therefore, the holding periods for A, B and C will be 4, 1 and 2 respectively.
2. Which of the items must be separately stated by the partnership?
Answer
Tax exempted interest
Dividend income
Gain from the sale of equipment-sec 1231 gain
3-False as payment is not only made for prior year but for other years a sum of 500 dollars or less must be made.
4-True as It is a cost related to the investment.
5-True As a single owned organization is majorly a sole proprietorship and can only be classified to be a different entity from the owner or can be taxed as an association.
6-False As is it is always due by April 15th provided the k1 form is submitted by march 15th
Reference
Joni, Larson (2013). Partnership Taxation: An Application Approach. Carolina Academic Press, 2013 - Law - 454 pages Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Partnership taxation Assignment Example | Topics and Well Written Essays - 250 words”, n.d.)
Partnership taxation Assignment Example | Topics and Well Written Essays - 250 words. Retrieved from https://studentshare.org/finance-accounting/1683833-partnership-taxation
(Partnership Taxation Assignment Example | Topics and Well Written Essays - 250 Words)
Partnership Taxation Assignment Example | Topics and Well Written Essays - 250 Words. https://studentshare.org/finance-accounting/1683833-partnership-taxation.
“Partnership Taxation Assignment Example | Topics and Well Written Essays - 250 Words”, n.d. https://studentshare.org/finance-accounting/1683833-partnership-taxation.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Partnership taxation

Taxation

...? TAXATION Sam Smith Computation of taxable trading income for 12 2. Computation of Income tax and National Insurance for tax year 12 Calculations of National Insurance contributions of Sam Smith for the year 2011-12 3. Computation of taxable income, income tax and NIC of Mr Sam Smith on being treated as employee for tax year 2011/12 Computation of Income tax for tax year 2011/12 4. Implications of change in status “An employee will pay taxes on earnings from his employment. A self employed will pay taxes on the profits of his trade.” (Christopher Jones)i As per HMRC “A worker’s employment status, that is whether they are employed or self employed, is not a matter of choice. Whether someone is employed or self employed...
6 Pages(1500 words)Assignment

Taxation

...………………………………………………………………………….xxxxxx …………………………………………………………………….xxxxxx …………………………………………………………………………xxxxx ………………………………………………………………………..xxxxx @2012 Taxation Q 1.1 General changes proposed for taxation of the company cars, for the company and for employees, for the next few tax years. According to Deloitte, there are several of changes that the government has proposed that will influence the cars belonging to the company as well as the private fuel used by both employees and employers. These changes aim at increasing further the tax charge on cars with high emissions of CO2. Back in 2002, the government introduced new reforms on company cars. The company car tax reform encourages people to buy of choose cars...
5 Pages(1250 words)Essay

Tax Aspects of Partnerships

... number Publish Tax Aspects of Partnerships Taxation law regarding partnerships in the United States tends to treat partnerships as flow through entities. Consequently, the entity in itself is not liable to tax payments but instead, the owners of the entity are liable to taxation depending on their ownership of the subject entity1 2. In order to compute the taxation payments, the owners of the entity are allowed under federal law to calculate how the income is distributed and hence how much tax is payable by each partner3. The distribution of income between partners for taxation purposes is subject to a host of different rules and regulations along with relevant case law. This paper will explore the various dimensions of taxation... as...
5 Pages(1250 words)Research Paper

Partnership vs.Corporation (Taxation)

...? Partnership vs. Corporation (Taxation) Partnership vs. Corporation (Taxation Compare and contrast the advantages and disadvantages inherent in electing to become a partnership and a corporation. Every business seeks to minimize losses and maximize profits. Profit maximization includes reducing expenses and the expenditures of a company. This also depends on the business model that a company chooses to register for. The available choices include electing between a corporation and a partnership. Each of these voted have implications attached to them. Advantages and disadvantages related to becoming a corporation Incorporating a business...
5 Pages(1250 words)Assignment

Taxation

...Political philosophies and Taxation There are various political philosophies in the world, and each of them possesses a considerably different view on the role of government in ensuring equality through taxation and other initiatives. This work intends to identify how liberalism and conservatism deal with the concept of taxation. In simple terms, Rawlsian liberalism claims that a just society has three qualities; a fair system of cooperation, a well-ordered society, and all citizens are free and equal (Rawls 87). In such a society, every member has the capacity to identify what is good, and has the right to discuss the concept with others and make necessary changes based on what is...
6 Pages(1500 words)Essay

Taxation

...Running head: TAXATION Taxation This paper describes UK tax environment; its types and income. Role and responsibility of a tax advisor has been discussed. After that different method of data collection is presented. Finally, a real life example is taken under consideration and the person’s income, amount of income tax payable and net capital gains are determined. Introduction Taxes are a collection of revenue from individuals who are citizens of a country or are residing in the country for purposes of leisure or work. Taxes are imposed to provide revenue for the government and allow the government to improve the civil needs of the country. A good example is the when the tax revenue collected is allocated...
6 Pages(1500 words)Essay

Taxation

.... Chattels are personal possessions that are ‘tangible’ assets. They may include furnishings, paintings etc for households. For the taxation of chattels, the rules of the Capital Gains tax are the same as for other assets i.e. the profits earned from the exchange of the chattels are not taxed if they are lesser than or equal to £ 6,000. Exemptions Some of the assets earned by the individuals and companies are exempted from the Capital Gains Tax. These assets are the ones that one is not charged for even after they have been sold for a higher price than what they were initially brought for. According to Lee (2009), the government does not consider the gains from the sale from the ‘exemptions’ as something that has to be...
8 Pages(2000 words)Essay

Taxation

...A NEUTRAL TAX SYSTEM Introduction Taxation of savings has an important role when you consider hoe economists evaluate tax systems. These savings are taxed for five reasons; first, it directly affects the tax base thus the term comprehensive income tax. Secondly, it is an important determinant of the extent to which tax system recognizes interpersonal differences in lifetime income, as opposed to annual income. Furthermore, it equalizes the tax burden. The third reason is that taxation of savings is the boundary between the taxation of personal income and taxation of company profits. Fourth, savings taxation can affect both the total amount of savings in...
8 Pages(2000 words)Essay

Taxation

...TAXATION By of the of the School The late 17th century saw an introductionof a land tax that was uniform to everybody. It practically formed the main source of revenue for the government particularly throughout the remaining part of the 17th century, the whole of 18th century and for the early part of the 19th century (James, 2009, pg. 24). In December 1798, William Pitt the Younger in his budget, announced income tax in Britain for the first time and it was introduced fully by 1799. This tax was to enable them pay for the equipment and weapons which was to enable them prepare for the Napoleonic Wars. This new progressive income tax introduced by Pitt saw the people remitting a levy of 2 old pence for every pound on...
8 Pages(2000 words)Essay

Taxation

...Should the UK government restore the 50% additional rate of income tax?” Introduction UK is being regarded as one of the few nations in the world which has higher income tax rates, which can be illustrated by the following graph. (Source HRMC 2012:30). Due to higher income tax rates, it is alleged that UK’s competitiveness has lost and hence, it is having a direct impact on its economic growth. Britain should learn from the OECD nations which have reduced their income tax rates to stimulate their economic growth. However, by increasing the income tax rates to 50%, UK has lost its competitive position as being a low-tax regime.When Margaret Thatcher came to power in 1979, she reduced the income tax rates from whooping 83% to 60... the UK...
6 Pages(1500 words)Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Assignment on topic Partnership taxation for FREE!

Contact Us