The Greene Partnership had average annual gross receipts for the past three years of $24.8 million, and never has reported average annual gross receipts above $25 million. One of the partners is Jackson, Inc., a C corporation. Because Greene meets the average annual gross receipts test, it may use the cash method of accounting even though it has a partner that is a C corporation.

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The statement is true. According to the IRS, a partnership may use the cash method of accounting if the partnership's average annual gross receipts for the past three years do not exceed $25 million. This holds true even if the partnership has a partner that is a C corporation. Therefore, since The Greene Partnership has an average annual gross receipt of $24.8 million, it may use the cash method of accounting.

The Greene Partnership Had Average Annual Gross Receipts for the Past