SelfStudy Problem 105 RS Associates is a partnership with a

Self-Study Problem 10.5 R&S; Associates is a partnership with a tax year that ends on August 31, 2017. During the partnership\'s tax year, R $1,000 per month as a guaranteed payment, and his share of partnership income after guaranteed payments was $21,000.F obert, a partner, recelved through December of 2017, Robert\'s guaranteed payment was increased to $1,500 per month. Calculate the amount of income from the partnership that Robert should report for his 2017 catendar tax year.

Solution

The increase in the guaranteed payments to $1500 will be reported in the tax year ending on August 31, 2018. The present guaranteed payments for the current year is reported in the tax year ended on August 31, 2017. Thus, the guaranteed payments received which are reported towards the partnership tax as a distributive share of the income of the partnership.

So, the amount of income from the partnership that Robert should report for his 2017 calender tax year =

Year\'s guaranteed payment = 1000 * 12 = 12000

Add: the distributive income of partnership = 21000

Total reported income = $33000