Which of the Following Statements Regarding Partnerships Versus S Corporations

question 66

Multiple Choice

Which of the following statements regarding partnerships versus S corporations is false?

• A) Ordinary income allocated from both types of passthrough entities is subject to self-employment tax.
• B) Partners are not permitted to be employees of their partnerships, but S corporation shareholders can be employees of their S corporation.
• C) S corporation shareholders are not liable for entity debts, but general partners are liable for partnership debts.
• D) Partnerships have more flexibility than S corporations in the manner in which items are allocated to the owners.

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Disabilities

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Competitive Advantage

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Diverse Workforce

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