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If I am a limited partner in an LP and still participate in…

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If I am a...

If I am a limited partner in an LP and still participate in management decisions, do I still have to pay social security tax on the pass through income?

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If i am a limited partner in an LP and participate in management decisions, do I have to pay SS on the pass through income?

Accountant's Assistant: Is there anything else important you think the Accountant should know?

GP is a shell corp---one limited partner who does all the work

Submitted: 1 month ago.Category: Tax
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Answered in 10 minutes by:
3/21/2018
Tax Professional: Carter McBride, Certified Public Accountant (CPA) replied 1 month ago
Carter McBride
Carter McBride, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1,038
Experience: Adjunct Professor
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Hey! I'm Carter, I'm a CPA and can help you out with this.

With the structure and the fact the partner is doing all the work , it is similar to the recent Renkenmeyer case where the IRS said the income was self-employment income since they were doing a majority of the work, even though they were classified as limited partners.

You can read more about that case here: https://www.thetaxadviser.com/issues/2011/jul/nash-jul2011.html

Let me know if you need anything else. If not, please leave a rating. Thanks!

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