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Nicholas, a One-Third Partner, Received a Guaranteed Payment in the Current

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Nicholas, a one-third partner, received a guaranteed payment in the current year of $50,000. Partnership income before consideration of the guaranteed payment was $20,000. Assuming that no loss limitation rules apply, Nicholas reports a $10,000 ordinary loss from partnership operations and the $50,000 guaranteed payment as ordinary income.


Definitions:

Phase Conductors

The wires or cables in an electrical system that carry the alternating current between the source and the load, in one or more phases.

Neutral Conductor

A conductor that carries current back to the source in electrical systems and is at a potential of zero volts.

Sequence

An ordered collection of objects or events that follow a specific pattern or arrangement.

Harmonic

A sinusoidal component of a periodic wave or quantity having a frequency that is an integral multiple of the fundamental frequency.

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