Which of the following statements regarding partnerships is TRUE?

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Partnerships may earn business income (from operating a business), property income (from owning and renting out property), and capital gains (from selling assets for more than they were purchased for). Partnership income is also taxed in the partnership and the individual partners report their share of the income and pay taxes on it on their personal income tax return. Additionally, partnership losses can be used to offset the partners' other income. All income earned by a partnership must be reported to Canada Revenue Agency.

Which of the Following Statements Regarding Partnerships Is TRUE