Big Law LLP, a Delaware limited liability partnership, is a service partner for which capital is not a material income-producing factor. The partnership and all its partners use the cash method in the calendar year. The partnership does not revalue its book assets when partners retire. It immediately distributes the full amount of the retiring partner's tax capital account, and then, following a decades-old practice, it distributes in ten equal annual cash payments the value of the retiring partner's share of the partnership's unrealized accounts receivable on the retirement date. These receivables are not included in the partner's tax capital accounts, and the partnership has an adjusted basis of zero in them. Under current law, these annual payments are:

a ) A distributive share of partnership income, taxable in the year of receipt b) Guaranteed payments, taxable in the year of receipt

c) Guaranteed payments, taxable in the year of retirement d) Payments in liquidation of the retiring partner's interest in the partnership, taxable as ordinary income in the year of retirement