Practice: Partnerships & Flow-Through Quiz Quiz | Tax Compliance & Planning (TCP)

Question 1

What is the defining feature of a flow-through entity?

Answer

It always pays corporate income tax.

Answer

Income and certain tax items generally pass through to the owners.

Answer

It cannot have more than one owner.

Answer

It is exempt from all taxes.

Question 2

Which business entity is generally considered a flow-through entity?

Answer

Traditional corporation

Answer

Government agency

Answer

Partnership

Answer

Nonprofit organization

Question 3

A partnership generally consists of:

Answer

Two or more persons carrying on a business together

Answer

One individual operating alone

Answer

Only corporations

Answer

Government entities only

Practice Quiz