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Partnership distribution

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Elias contributed $100,000 to become a 1/3 partner in CDE Partnership. The partnership agreement specifies that Elias's 1/3 share of partnership profits is calculated before deducting any guaranteed payments, and guarantees that his share of "profits" will never be less than $20,000. Additionally, the partnership agreement specifies that Elias will receive an annual 6% "interest payment" on his capital contribution.

What is Elias's distributive share and guaranteed payment (if any) if the partnership earns $45,000 of ordinary income and $25,000 of long-term capital gains for the year?

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What is Elias's distributive share and guaranteed payment (if any) if the partnership earns $45,000 of ordinary income and $25,000 of long-term capital gains for the year?

-- The long-term capital gain of $25,000 is a gain that the partnership will have to ...

Solution Summary

This solution calculates each of the contribution and capital gains questions provided. All elements are addressed.

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