Question

According to the Internal Revenue Service, A. profitable partnerships pay taxes before distributing profits. B. partners report their share of profits as personal income. C. partners pay no taxes. D. partners have the most advantageous tax structure. E. all of the above.

Answer 1

(B). Partners report their share of profits as personal income.

Step-by-step explanation:

According to the Internal Revenue Services (IRS), a partnership itself does not pay taxes.

Profits are shared between the partners in the partnership business who report their share of the profits as personal income.

It is the partners who then pay income taxes on their share of the profits.