Anyone who can help on a qualified settlement fund and the recognition of income? A law firm (2 partners) has their fee put into a QSF. One partner takes his/her share out and one leaves the other 50% in the fund. Taxability to the firm? Taxability to the 2 partners?
Another scenario - neither partner takes the $ out, the firm has no other revenue for the year. Does the firm's 1065 show -0- revenue for the year or is the fee in the QSF taxable income to the firm when it goes into the fund?
------------------------------
Jay P. Haberman, CPA
998C Old Country Rd, PMB 422
Plainview, NY 11803
(516) 775-0175
jayh@cpa.com
------------------------------