Q:
Which of the following statements regarding Real Estate Limited Partnerships (RELPs) is/are correct?
I. A goal of the RELP is to establish a continuity of life for the partners
II. All of the profits from the RELP will pass through to the owners of the business
III. The RELP sends each partner a 1099-Misc to be used to compute their personal tax returns
IV. The limited partnership itself pays no taxes
a) II and IV only
b) II and III only
c) I and II only
d) I and IV only
A:
The correct answer is a):
Limited partnerships are formed to engage in a business venture for a predetermined period of time, one the business goals have been achieved the RELP is dissolved. The main tax advantage of the RELP is that the IRS treats it as a “flow-through” entity, meaning that all of the profits/losses of the RELP are passed to the owners. The RELP itself is not taxed, each partner receives a Schedule K-1 which is used to compute their individual tax return.

MORE FAQS

  1. Which of the following are not types of open-end management investment companies ...

  2. Under the Uniform Securities Act, which of the following are defined as securities ...

  3. A margin account has a long market value of $12,000, a debit balance of -$6,000 ...

  4. Which of the following signatures are required on a client’s new account form ...

  5. Which statements about common shareholder rights are FALSE? I. A shareholder may exchange shares to ...

  6. Which of the following statements is(are) true with respect to the factors that a manager must take ...

  7. Which of the following statements is (are) true with respect to setting the proper constraints in managing ...

  8. Which statement(s) is/are FALSE about market risk?

  9. What's the difference between general, limited and joined venture partnerships?

  10. Which of the following statements is (are) true with respect to the factors that a manager must take ...

  11. Which TWO statements are TRUE about writing covered calls? I ...

  12. Which of the following are tools that are employed by the Federal Reserve in its efforts to control the money supply?

  13. If a sales representative moves from one broker-dealer to another ...

  14. Which of the following deliveries for a 600 share order, broker-dealer to broker-dealer ...

  15. Among the following property ownership arrangements, which may be entered into by spouses only ...

  16. Are dividends the best way to make money for retirement?

  17. Is it possible to refinance a house you're renting out?

  18. Do home appraisers use Zillow?

  19. What Home-Buying Costs Can I Deduct from Taxes?

  20. What's the average salary of a financial advisor?

RELATED FAQS

  1. Which of the following are not types of open-end management investment companies ...

    The correct answer is d) Hedge funds are extremely aggressive entities that engage in margin and short-selling.  They are ...
  2. Under the Uniform Securities Act, which of the following are defined as securities ...

    The correct answer is a. Fixed annuities are not considered securities, since the purchaser bears no investment risk. However, ...
  3. A margin account has a long market value of $12,000, a debit balance of -$6,000 ...

    The correct answer is a. I is correct since the stock's currently valued at $12,000 are increasing 20% or $2,400. II is incorrect ...
  4. Which of the following signatures are required on a client’s new account form ... ...

    The correct answer is B. While local practices of a broker-dealer might require the client to sign the form, even when opening ...
  5. Which statements about common shareholder rights are FALSE? I. A shareholder may ...

    The correct answer is a. I should be the the other way around: convertible bond holders can exchange their bonds for shares. ...
  6. Which of the following statements is(are) true with respect to the factors that ...

    The correct answer is: c) (I) is incorrect because while he amount of new underwriting business that may be undertaken is ...
RELATED TERMS
  1. Real Estate Limited Partnership - RELP

    A limited partnership entity organized to invest in real estate. ...
  2. Limited Partnership - LP

    Two or more partners united to conduct a business jointly, and ...
  3. Partnership

    A business organization in which two or more individuals manage ...
  4. IRS Publication 541

    A document published by the Internal Revenue Service (IRS) that ...
  5. Publicly Traded Partnership - PTP

    A business organization owned by two or more co-owners, that ...
  6. Form 1065

    A tax document used to report the profits, losses and deductions ...
Hot Definitions
  1. Sharpe Ratio

    The Sharpe Ratio is a measure for calculating risk-adjusted return, and this ratio has become the industry standard for such ...
  2. Death Taxes

    Taxes imposed by the federal and/or state government on someone's estate upon their death. These taxes are levied on the ...
  3. Retained Earnings

    Retained earnings is the percentage of net earnings not paid out as dividends, but retained by the company to be reinvested ...
  4. Demand Elasticity

    In economics, the demand elasticity refers to how sensitive the demand for a good is to changes in other economic variables. ...
  5. Dark Pool

    A dark pool is a private financial forum or exchange for trading securities.
  6. Quadruple Witching

    The expiration date of various stock index futures, stock index options, stock options and single stock futures. All stock ...
Trading Center