George and Lane are 50/50 partners in Blue Light General Partnership which owns and operates a hotel. They have owned the partnership for 5 years, and both have full-time jobs elsewhere. They have come to the realization that they need someone to manage the hotel for them. Their friend Jenna recently lost her job managing a similar hotel in another town nearby. George and Lane decide that this is the perfect opportunity to bring in a full-time manager, but they know that Jenna will not move to their town unless she can have an ownership in the partnership, so they decide to give her a 15% ownership in the partnership as of January 1, 2021, the date that she will begin managing the hotel. Jenna will continue to manage the hotel as long as she is a member of the partnership.

For this assignment, report the results of your research by preparing a draft of a research memorandum. The preparation of an effective and efficient tax research memorandum requires a thorough analysis of the issue, facts, and authoritative rule, statement, or regulation to determine an appropriate conclusion.

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