Stephanie is a calendar year cash basis taxpayer.She owns a 50% profit and loss interest in a cash basis partnership with a September 30 year-end.The partnership's operating income (after deducting guaranteed payments) was $120,000 ($10,000 per month) and $144,000 ($12,000 per month),respectively,for the partnership tax years ended September 30,2016 and 2017.The partnership paid guaranteed payments to Stephanie of $2,000 and $3,000 per month during the fiscal years ended September 30,2016 and 2017.How much will Stephanie's adjusted gross income be increased by these partnership items for her tax year ended December 31,2016?

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Stephanie's adjusted gross income for 2016 includes her share of the partnership's income from October 1, 2015, to September 30, 2016, plus the guaranteed payments received during that period. Her share of the partnership's operating income is 50% of $120,000, which is $60,000. The guaranteed payments she received were $2,000 per month for 12 months, totaling $24,000. Therefore, her adjusted gross income is increased by $60,000 + $24,000 = $84,000.

Stephanie Is a Calendar Year Cash Basis Taxpayer