Mark is a cash basis taxpayer.He is a partner in the M&M partnership,and his share of the partnership's profits for 2015 is $90,000.Only $40,000 was distributed to him in January 2015,and this was his share of the 2014 partnership profits.None of the 2015 profits were distributed .Mark's gross income from the partnership for 2015 is $40,000.

Question

Quizplus · Accepted Answer

As a cash basis taxpayer, Mark's gross income from the partnership for 2015 would only include the amount actually distributed to him in 2015, which is $40,000 from the 2014 profits. Therefore, his gross income from the partnership for 2015 is $40,000 and not $90,000.

Mark Is a Cash Basis Taxpayer