In the absence of a partnership agreement, the law says that income (and loss) should be allocated based on:
A fractional basis.
The ratio of capital investments.
Salary allowances.
Equal shares.
Interest allowances.
2007-12-21 21:08:25 · 3 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
As long as the basis is reasonable, any of those would be acceptable.
Am I missing something here?
2007-12-22 00:12:39 · answer #1 · answered by Steve 6 · 0⤊ 0⤋
The best advice I can give you is to get a partnership agreement. As of right now you and your partner(s) have a big pile of money with no rules as to how it is split -- same holds true for your tax liabilities. A contract does NOT mean you don't trust each other, but rather just spells out exactly how things should be done in your company, so don't be afraid to insist on one. This of course won't help you right now, but next year you'll be happy you did it.
2007-12-23 21:46:55 · answer #2 · answered by darkridr 6 · 0⤊ 0⤋
What is the question?
2007-12-22 21:46:29 · answer #3 · answered by Ms. Angel.. 7 · 0⤊ 0⤋