When a retiring partner receives payments that exceed the value of that partner's partnership property, the excess payment is a guaranteed payment.

Question

Quizplus · Accepted Answer

The excess payment is not considered a guaranteed payment; it is typically treated as a distribution of the retiring or withdrawing partner's share of the partnership's profits or capital. Guaranteed payments are those made by a partnership to a partner for services or the use of capital and are determined without regard to the partnership's income.

When a Retiring Partner Receives Payments That Exceed the Value