Question Details

1. In many respects, the fundamentals of partnership taxation are very similar to those of the S-corporation taxation that we learned last week. Accordingly, you would be wise to rely on the things you already know and to simply review the material presented this week in order to identify the significant differences between partnership and S-corporation taxation. One such area is the tax consequences of partnership formation. Are the tax consequences of the formation of a partnership similar to those of S-corporations? How? If there are differences, how and why are they different? 

2. As with S-corporations, we track a partner's basis in his or her partnership interest (otherwise known as the outside basis) as a measurement of the amount of post-tax investment that the partner has in the partnership. Do we calculate and adjust a partner's outside basis in the same way that we calculate S-corporation shareholders' stock basis? If there are any differences, what are the justifications for the differences?

3. Are you in favor of a flat tax and to just get rid off the almost 75000 pages of the current code? What do you think is the down-side of this strategy?

Just need about 200-250 word response to each question.