Samuel is the managing general partner of STU, in which he owns a 30% interest.For the year, STU reported income of $260,000 (after deducting all guaranteed payments).Samuel received a guaranteed payment of $40,000 for capital that he had loaned the partnership, and he received a guaranteed payment of $120,000 for services he performed for STU.How much income from self-employment did Samuel earn from STU?
A)$120,000.
B)$160,000.
C)$198,000.
D)$238,000.
E)$380,000.

Question

Quizplus · Accepted Answer

Samuel's share in STU's income is 30% of $260,000, which is $78,000. In addition, he received guaranteed payments of $40,000 and $120,000, which are considered income. Therefore, his total income from STU is $78,000 + $40,000 + $120,000 = $238,000. Since he is the managing general partner, this income is subject to self-employment taxes. Therefore, the amount of income from self-employment that Samuel earned from STU is $238,000.

Samuel Is the Managing General Partner of STU, in Which