If a Partner of an LLP Is Not Liable to a Creditor

question 89

Multiple Choice

If a partner of an LLP is not liable to a creditor that the remaining partners are liable to,then he:

• A)must contribute the shortfall.
• B)must contribute based on his interest in the partnership.
• C)cannot be forced to pay the debt.
• D)must split the amount between the other partners and himself.

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Definitions:

Cost Recovery Deduction

A tax deduction that allows a taxpayer to recover the cost of property or assets over time through depreciation.

Warehouse

A large commercial building for storing goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc.

Land Valuation

The process of determining the present worth of a piece of land based on its highest and best use, market conditions, and other factors.

Depreciable Cost Basis

The portion of the cost of an asset that can be deducted over time for tax purposes.