Which of the following statements is not correct?
A) Each general partner has unlimited liability for the debts of a partnership.
B) Federal income tax is levied on the net income of a partnership and on the earnings of the individual partners when the net income is distributed to them.
C) Any general partner can make valid contracts for a partnership and can otherwise conduct its affairs.
D) When a partner dies or is incapacitated,the partnership is dissolved.

Question

Quizplus · Accepted Answer

Partnerships themselves are not subject to federal income tax; instead, the income is passed through to the individual partners, who then report it on their personal tax returns.

Which of the Following Statements Is Not Correct