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RHam
New Member

My wife was in a two-person business partnership. She died in September. As her heir, I was given her share of the partnership's remaining cash on hand. Is it taxable?

The surviving partner told me this money had already been taxed in previous years and therefore would not be taxable now.  Is this true?

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IreneS
Intuit Alumni

My wife was in a two-person business partnership. She died in September. As her heir, I was given her share of the partnership's remaining cash on hand. Is it taxable?

I'm sorry for your loss.

No.  According to the IRS Pub. 541 - Partnerships, the cash you received from the partnership is considered a distribution and is not taxable as long as the amount you received does not exceed your wife's adjusted basis in the partnership (which it probably doesn't).




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2 Replies
IreneS
Intuit Alumni

My wife was in a two-person business partnership. She died in September. As her heir, I was given her share of the partnership's remaining cash on hand. Is it taxable?

I'm sorry for your loss.

No.  According to the IRS Pub. 541 - Partnerships, the cash you received from the partnership is considered a distribution and is not taxable as long as the amount you received does not exceed your wife's adjusted basis in the partnership (which it probably doesn't).




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**Mark the post that answers your question by clicking on "Mark as Best Answer"
RHam
New Member

My wife was in a two-person business partnership. She died in September. As her heir, I was given her share of the partnership's remaining cash on hand. Is it taxable?

Thank you!
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