Stephen is admitted to the HHH Partnership on January 1 of thecurrent year in...

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Accounting

Stephen is admitted to the HHH Partnership on January 1 of thecurrent year in return for his services managing the partnership’sbusiness during the year. The HHH partnership reportsordinary income of $200,000 for the current year.
What are the tax consequences to Stephen and to the HHHpartnership if Stephen receives a 30% interest in the partnershipwith an $80,000 FMV.
What are the tax consequences if Stephen contributes qualifyingproperty to the HHH partnership in addition to his professionalservices?

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3.6 Ratings (440 Votes)

1 30 of the ordinary income of 200000 ie 60000 will be taxable in the hands of Stephen as SelfEmployment Tax Stephen has to file the above incomes in return Form No1040 along See Answer

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In: AccountingStephen is admitted to the HHH Partnership on January 1 of thecurrent year in return...Stephen is admitted to the HHH Partnership on January 1 of thecurrent year in return for his services managing the partnership’sbusiness during the year. The HHH partnership reportsordinary income of $200,000 for the current year.What are the tax consequences to Stephen and to the HHHpartnership if Stephen receives a 30% interest in the partnershipwith an $80,000 FMV.What are the tax consequences if Stephen contributes qualifyingproperty to the HHH partnership in addition to his professionalservices?