Which of the Following Statements Regarding the Rationale for Adjusting

question 72

Multiple Choice

Which of the following statements regarding the rationale for adjusting a partner's basis is false?

• A) To prevent partners from being double taxed when they receive cash distributions.
• B) To ensure that partnership tax-exempt income is not ultimately taxed.
• C) To ensure that partnership non-deductible expenses are never deductible.
• D) To prevent partners from being double taxed when they sell their partnership interests.
• E) None of these rationales are false.

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