A Partnership Terminates for Tax Purposes

question 23

Multiple Choice

A partnership terminates for tax purposes

• A)only when it terminates under local partnership law.
• B)when at least 50% of the total interest in partnership capital and profits changes hands by sale or exchange within twelve consecutive months.
• C)when the sale of partnership assets is made only to an outsider(s)and not to an existing partner(s).
• D)when a partnership tax return (Form 1065)ceases to be filed by the partnership.

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Definitions:

Compensation Strategy

A plan or approach for determining how employees will be rewarded for their work, including salaries, bonuses, and benefits.

Direct Pay

Compensation paid directly to employees for their work, including salaries, wages, and bonuses, not including indirect benefits like health insurance.

Indirect Pay

Refers to benefits or perks received by employees that are not part of their direct monetary compensation, such as health insurance, retirement plans, or paid time off.

Reward System

A system that recognizes and rewards employees for their contributions to the organization, often influencing their performance and motivation.