Final answer:
The character of each separately stated item is indeed determined at the partner level, which is crucial for the correct taxation of each partner in a partnership.
Step-by-step explanation:
The statement 'The character of each separately stated item is determined at the partner level' is True. In the context of partnership taxation, each partner in a partnership must report items of income, deduction, gain, loss, or credit on their own tax return in a manner consistent with the character of the item at the partnership level. However, certain items may be separately stated due to their nature or the tax treatment they require, and hence, they could affect each partner's tax liability differently. This aspect is important as it ensures that each partner is taxed correctly according to their own tax situation on items such as capital gains, charitable contributions, foreign transactions, etc.