20 Jul Characterizing Partner Distributions
Posted at 00:00h
in Cost Basis, Distributions, Investment Income, Retirement, Small Business, Tax Guidance & Preparation, Taxable Income
Generally if payments are in exchange for partnership property, the amount received in excess of the partner’s outside basis in his/her partnership interest is taxed as capital gain. However if the payments represent a distributive share of partnership income or are deemed to be guaranteed payments, the payments are taxed as ordinary income. According to...