The TUV Partnership is considering two compensation schemes for Tracy, the partner who runs the business on

Question:

The TUV is considering two compensation schemes for Tracy, the partner who runs the business on a daily basis. Tracy can be given a $10,000 guaranteed payment, or she can be given a comparably larger distributive share (and distribution) so that she receives about $10,000 more each year. From the standpoint of when the income must be reported in Tracy’s tax return, are these two compensation alternatives the same?
Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...