Federal Income Tax HW W5

The central concept learned during week five was the termination of a business
partnership. A partnership comes into existence when two or more individuals combine and
operate their business entities as one. When a company dissolves, it means that the individuals
are not together legally. However, their partnership will continue for the legal purposes of
finishing the business. That will entail selling of the assets in the partnership business, paying the
debts, and equally distributing the money to the partners or the heirs. A legal rule all the partners
have the legal right to take part in the winding up of the business process and get a share of the
distribution of the assets. However, is the termination of the partnership takes place as a result of
the death of one of the partners, the remaining partner has the legal right to make the full power
of disposing of the assets. More so, the partners can come into an agreement where one of them
will have an exclusive authority to dispose of the assets in case of termination.
My experience with the week five concept was interesting as I was in a position to
understand the lessons properly. The class questions on partnership distributions gave an
adequate elaboration of what may lead to the termination of partnerships and the steps that will
follow. I had some challenges in understanding the basis for partnership taxation. However, form
the questions, I was able to resonate with the issues and understand the process of partnership
taxation. But I would like a clarification on the matter, “what are some of the legal qualifications
for a business entity to take part in partnership formation?”