Nate is a partner in a partnership that received $5,000 of interest income this year.Nate's share of the interest is $1,000, and he should report this income on his individual return as:

Question

Quizplus · Accepted Answer

Nate's share of the interest income should be reported on his individual return as interest income, not business income or income from a partnership since it is a passive income. The fact that the partnership intends to organize as an LLC next year does not affect how the interest income should be reported.

Nate Is a Partner in a Partnership That Received $5,000