Which of the following is not a characteristic of a partnership?
A) Each general partner has unlimited liability for the debts of the partnership.
B) If one partner dies or leaves the partnership,the existing partnership is terminated.
C) The partnership income is subject to a federal income tax that is levied on the business but not on the partners.
D) The existing partnership agreement is dissolved and a new agreement is formed when a new partner joins the partnership.

Question

Quizplus · Accepted Answer

Partnership income is not subject to a federal income tax that is levied on the business. Instead, the income is allocated to the partners based on their ownership interest, and each partner reports their share of the income on their individual tax return. This means that the partnership itself does not pay federal income tax, but the partners do.

Which of the Following Is Not a Characteristic of a Partnership