Which of the following statements exemplifies the entity theory of partnership taxation?
A) Partnerships are taxable entities.
B) Partnerships determine the character of separately stated items at the partnership level.
C) Partnerships make the majority of the tax elections.
D) Both Partnerships are taxable entities and Partnerships make the majority of the tax elections.
E) Both Partnerships determine the character of separately stated items at the partnership level and Partnerships make the majority of the tax elections.

Question

Quizplus · Accepted Answer

Not only do partnerships make the majority of elections, but also the character of gains and losses is determined at the partnership level. Additionally, a partnership is considered a flow-through entity and only files information returns.

Which of the Following Statements Exemplifies the Entity Theory of Partnership