Red Corporation and Green Corporation are equal partners in the R & G Partnership.Red Corporation's tax year ends September 30th, and Green Corporation is a calendar year taxpayer.R & G Partnership must use September 30th as its tax year, unless it has a business purpose for using a different tax year.

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Quizplus · Accepted Answer

This is true according to the IRS guidelines which state that a partnership's tax year should be the same as that of its majority partner or, if there is no majority partner, the tax year of the partner with the most interest. In this case, Red Corporation's tax year ends September 30th, so the R & G Partnership must use that tax year unless it has a valid business purpose for using a different tax year.

Red Corporation and Green Corporation Are Equal Partners in the R