Question

How to calculate the total income of partnership firm?

Answer 1

Step

Calculate the total amount invested in the partnership with cash and property value. Call this "original basis." For example, if you placed $2,000, $1,000 and $2,000 into the partnership over a three-year period, your original basis is $5,000.

Step

Calculate distributions. If the partnership dispersed $1,500 over this year and last year to you, your total distributed amount is $3,000.

Step

Subtract the distributions from your original basis. This number is your current partnership basis. In this example: $5,000 - $3,000 = $2,000.