Review the tax return for the business (Form 1120S ) and the K1 for Morty. Jerry decides that no distributions will be made, and since he has 52% of the vote, it appears that he has majority vote. For this question, assume that the operating agreement says that distributions will be voted on based on Membership Ownership percentage. Which of the following is true. Morty will be allocated $90,000 of income that will be taxed on his individual tax return. The business will pay income tax on $90,000 of income. Morty will be allocated $21,600 of income that will be taxed on his individual tax return. The business will distribute $21,600 of cash to Morty. eview the operating agreement. What is true about distributions from the company? The LLC could take distributions no matter what the financial condition of the LLC. Distributions from the LLC are required by law. Jerry having 52% ownership could likely cause no distributions by voting against any distributions, and if so, any taxes due would have to come from personal monies. Distributions equal the net income of the business