Burgundy, Inc., and Violet Gomez are equal partners in the calendar year BV LLC. Burgundy uses a fiscal year ending April 30, and Violet uses a calendar year. Burgundy receives an annual guaranteed payment of $100,000 for use of capital contributed by Burgundy. BV’s taxable income (after deducting the payment to Burgundy) is $80,000 for 2020 and $90,000 for 2021. How much income from BV must Burgundy report for its tax year ending April 30, 2021? Burgundy receives a guaranteed payment of $100,000 plus 50% of $80,000 = $40,000 Burgundy’s total income is $140,000 How much income from BV must Violet report for her tax year ending December 31, 2021? Violet receives 50% of $90,000, BV’s taxable income after guaranteed payment to Burgundy, 50% of $90,000= $45,000
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Burgundy, Inc., and Violet Gomez are equal partners in the calendar year BV LLC. Burgundy uses a fiscal year ending April 30, and Violet uses a calendar year. Burgundy receives an annual guaranteed payment of $100,000 for use of capital contributed by Burgundy. BV’s taxable income (after deducting the payment to Burgundy) is $80,000 for 2020 and $90,000 for 2021.
How much income from BV must Burgundy report for its tax year ending April 30, 2021?
Burgundy receives a guaranteed payment of $100,000 plus 50% of $80,000 = $40,000 Burgundy’s total income is $140,000
How much income from BV must Violet report for her tax year ending December 31, 2021?
Violet receives 50% of $90,000, BV’s taxable income after guaranteed payment to Burgundy, 50% of $90,000= $45,000
Given information is:
Annual guaranteed payment for Burgundy = $100,000
Taxable income for 2020 = $80,000
Taxable income for 2021 = $90,000
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