Problem 4-42 (LO. 3, 4) Faye, Gary, and Heidi each have a one-third interest in the capital and profits of the FGH Partnership. Each partner had a capital account of $50,000 at the beginning of the tax year. The partnership profits for the tax year were $270,000. Changes in their capital accounts during the tax year were as follows: Faye Gary Heldi Total Beginning balance $50,000 $50,000 $50,000 $150,000 Withdrawals (20,000) (35,000) (10,000) (65,000) Additional contributions 0 Allocation of profits 90,000 90,000 5,000 90,000 5,000 270,000 Ending balance $120,000 $105,000 $135,000 $360,000 Compute each partner's gross income from the partnership for the tax year. Each partner's gross income from the partnership for the tax year is s Feedback Check My Wik 90,800 x A partnership is not a separate taxable entity. Rather, the partnership merely files an information return (Form 1065), which serves to provide the data necessary for determining the character and amount of each partner's distributive share of the partnership's income and deductions. Congress enacted & 79, which created a limited exclusion for group term life insurance. This exclusion only applies to employees. Mon Feb 8 10 15