Identify Which of the Following Statements Is True

question 18

Multiple Choice

Identify which of the following statements is true.

• A)The partnership tax year closes when a partner transfers his interest by gift.
• B)If a partner dies in a two-member partnership, the partnership terminates on the date of death, even though the successor-in-interest continues to share in the profits and losses of the partnership business.
• C)When the interest of a partner who owns 60% of a partnership is completely liquidated by a partnership distribution, the partnership is considered terminated, even though three other partners remain.
• D)All of the above are false.

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Definitions:

Gift

A voluntary transfer of property for which the donor receives no consideration in return.

Title

The formal right of ownership of property, whether real or personal, tangible or intangible.

Bailment

The temporary placement of control over or possession of personal property by one person into the hands of another, under agreement.

Transfer of Exclusive Possession

The act of transferring the right to exclusively occupy or use property or goods to another party.