XYZ, LLC Has Several Individual and Corporate Members

question 103

Multiple Choice

XYZ, LLC has several individual and corporate members. Abe and Joe, individuals with 4/30 year-ends, each have a 23% profits and capital interest. RST, Inc., a corporation with a 6/30 year end, owns a 4% profits and capital interest while DEF, Inc., a corporation with an 8/30 year end, owns a 4.9% profits and capital interest. Finally, thirty other calendar year-end individual partners (each with less than a 2% profits and capital interest) own the remaining 45% of the profits and capital interests in XYZ. What tax year-end should XYZ use and which test or rule requires this year-end?

• A) 4/30, principal partners test.
• B) 4/30, least aggregate deferral test.
• C) 12/31, principal partners test.
• D) 12/31, least aggregate deferral test.

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Definitions:

Saunas

Heated rooms or buildings used for relaxation or therapeutic purposes, typically involving steam or dry heat.

Open Adoption

An adoption process where the adoptive and biological parents have some form of interaction, including exchange of personal information or contact.

Biological Parents

The individuals who are genetically related to a child, contributing to the child's conception and birth.

Internationally Adopt

The process of adopting a child from another country through legal means, which involves navigating both the adoptive parents' national laws and those of the child's country.