Partnership profits:
A)are fully distributed as taxable income to the partners.
B)are distributed to general partners with interest paid to limited partners.
C)are distributed to the partners on an aftertax basis.
D)are generally reinvested in the firm rather than being distributed.
E)are generally held by the partnership and later distributed as dividend payments.

Question

Quizplus · Accepted Answer

Partnership profits are considered income for each partner and are fully distributed as taxable income to the partners. The partners then pay taxes on their individual shares of the profits.

Partnership Profits