Читать книгу Taxation Essentials of LLCs and Partnerships - Larry Tunnell - Страница 16

Dawn is a one-half partner in Sunrise Partnership. This year, the partnership reported taxable income of $100,000, of which Dawn's share was $50,000. The partnership made monthly distributions to Dawn of $2,000 ($24,000 total). When Dawn files her individual tax return for the current year, she will include her $50,000 share of the partnership's income (on Schedule E of her Form 1040). The distributions will not affect her taxable income. Therefore, her involvement with the partnership will increase her taxable income by her full $50,000 share of partnership income, even though only $24,000 of this income was distributed to her during the year. In effect, the remaining $26,000 of undistributed taxable income has been reinvested by Dawn in the partnership's business activities.

Losses also flow through to the partners and can be deducted by them on their own tax returns. Again, this is a departure from the corporate tax scheme, in which losses can be carried forward to offset future corporate income but provide no tax benefits until actually offset against positive corporate taxable income. In contrast, partnership losses are reported by the partners on their own tax returns, and if deductible, provide immediate tax benefits in the form of a reduced tax burden on the partners' other income in the year of the loss.