Which of the Following Is Not a Characteristic of a Partnership

question 83

Multiple Choice

Which of the following is not a characteristic of a partnership?

• A)Must be formed under state law
• B)Formation is generally tax free except for services received for a partnership interest
• C)Distributions of entity income are tax-free
• D)Loss is never recognized on a nonliquidating distribution

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Definitions:

Surprise

An unexpected or astonishing event, fact, or thing that takes someone unawares.

Ambiguous

Describes statements or terms that are unclear or have multiple interpretations, often leading to confusion or misunderstanding.

Buyer

An individual or entity that purchases goods or services for personal use, resale, or production purposes.

Inspect

To examine something carefully in order to assess its condition or to discover its existence.