Fred and Wilma formed the equally-owned FW partnership several years ago. On the last day of the prior tax year, they each transferred a 20% interest in the FW partnership (a capital-intensive business) to their son, Rocky (40% total to Rocky; Fred and Wilma each retained 30% interests). For the current tax year, FW reported income of $200,000. Fred provides services to the partnership valued at $60,000; Wilma and Rocky provide no services. The $200,000 of income will be allocated $102,000 to Fred, $56,000 to Rocky, and $42,000 to Wilma.

Group of answer choices

True

False