Congress rationale for limiting the taxable years


Which of the following statements best describes Congress's rationale for limiting the taxable years a partnership may use? (select the best answer)

a. The partnership's tax year should generally be as close as possible to the partners' tax year ends to avoid deferral of time between when the partnership income is reported and when the partners report it on their tax returns.

b. The partnership tax year must correspond to the partnership's natural business cycle.

c. The partners should select a tax year that is as close as possible to the partnership's tax year to avoid deferral of time between when the partners and the partnership report the income.

d. The partnership tax year must provide for a three month average deferral between the partners' year end and the partnership's year end so that there is sufficient time between the dates the partnership and the partners file their tax returns.

e. None of the above statements are true.

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Accounting Basics: Congress rationale for limiting the taxable years
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