Marcie is a 40% partner in the MAP Partnership.During the current tax year,the partnership reported ordinary income of $140,000 before payment of guaranteed payments and distributions to partners.The partnership made an ordinary cash distribution of $10,000 to Marcie,and paid guaranteed payments to partners Marcie,Alice,and Pat of $20,000 each ($60,000 total).How much will Marcie's adjusted gross income increase as a result of the above items?

Question

Quizplus · Accepted Answer

Marcie's share of partnership income before distributions is $140,000 x 40% = $56,000. 
She also received a cash distribution of $10,000 and a guaranteed payment of $20,000. 
Therefore, her total income from the partnership is: 
$56,000 (her share of income) + $10,000 (cash distribution) + $20,000 (guaranteed payment) = $86,000 
Her adjusted gross income will increase by $86,000.

Marcie Is a 40% Partner in the MAP Partnership