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:

Rosalie Rayner

An American psychologist, best known for her work with John B. Watson and the Little Albert experiment on conditioned emotional responses.

Psychological Laboratory

A controlled environment where experiments are conducted to study psychological processes, often using scientific methods to understand behavior and mental functions.

Wundt

A psychologist often referred to as the father of experimental psychology, known for establishing the first psychology laboratory.

Plato

An ancient Greek philosopher, a student of Socrates, whose work laid the foundations for much of Western philosophy and science.