Nick MacDonald
Level 3
01-06-2020
02:35 PM
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I read an article suggesting partnerships should revisit and revise the partnership agreements to remove references to guaranteed payments.
By treating them as deductible guaranteed payments, you are increasing your expenses and reducing the benefit of the QBI deduction. The strategy would be to treat all partner transactions as distributions as opposed to guaranteed payments.
Of course, partners would need to focus on quarterly payments after making this change.