Essentials of Federal Income Taxation 9. Guaranteed Payments and Allocation of Partnership Income. (Obj. 3) ABC partnership provides for "salaries" (guaranteed payments) of $70,000, $64,000, and $60,000 for partners A, B, and C, respectively. After the guaranteed payments are deducted, the partnership agreement calls for sharing of profits and losses as follows: A - 40%; B-35%; and C - 25%. a. If partnership profits before the guaranteed payments are $120,000, what amount of income from the partnership should each partner report on his or her own personal income tax return? girlsruhe b. How would your answer to Part a. change if partnership profits before guaranteed payments were $220,000 (instead of $120,000)?

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Chapter1: Financial Statements And Business Decisions
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2022 tax rules
Essentials of Federal Income Taxation
9. Guaranteed Payments and Allocation of Partnership Income. (Obj. 3) ABC partnership provides
for "salaries" (guaranteed payments) of $70,000, $64,000, and $60,000 for partners A, B,
and C, respectively. After the guaranteed payments are deducted, the partnership agreement
calls for sharing of profits and losses as follows: A - 40%; B - 35%; and C - 25%.
a. If partnership profits before the guaranteed payments are $120,000, what amount of
income from the partnership should each partner report on his or her own personal
income tax return?
D girlenend
b. How would your answer to Part a. change if partnership profits before guaranteed
payments were $220,000 (instead of $120,000)?
Transcribed Image Text:Essentials of Federal Income Taxation 9. Guaranteed Payments and Allocation of Partnership Income. (Obj. 3) ABC partnership provides for "salaries" (guaranteed payments) of $70,000, $64,000, and $60,000 for partners A, B, and C, respectively. After the guaranteed payments are deducted, the partnership agreement calls for sharing of profits and losses as follows: A - 40%; B - 35%; and C - 25%. a. If partnership profits before the guaranteed payments are $120,000, what amount of income from the partnership should each partner report on his or her own personal income tax return? D girlenend b. How would your answer to Part a. change if partnership profits before guaranteed payments were $220,000 (instead of $120,000)?
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