Financial Planning Body of Knowledge
The Financial Planning Body of Knowledge (FP-BoK) describes knowledge expected of CFP® professionals
and QAFPTM professionals.
Taxation of a Partnership
KNOWLEDGE EXPECTED OF: CFP® Professionals Only
- Define types of income that a partner may receive from a partnership, such as:
- Income allocation
- Explain how income earned by a partnership is taxed.1,2
- Explain how Capital Cost Allowance (CCA) is allocated in a partnership.
- Explain how personal property transferred by a partner into a partnership may be treated for tax purposes.3
- Explain how property disposed of by a partnership may be treated for tax purposes.
- Define a capital account for a partnership.
- Explain the purpose of a capital account for a partnership.
- Define components of the capital account for a partnership, such as:
- Income allocations
- Explain how the balance of the capital account for a partnership is affected by its components.
- Identify components that affect the adjusted cost base of a partner’s partnership interest.
- Explain the tax implications when the adjusted cost base of a partner’s interest in a partnership becomes negative.
Glossary of Verbs (mouse over to see definition)
Read more about the Taxonomy used in the FP-BoK
To state exactly the meaning of
To be aware of / to recognize and correctly name / to locate an appropriate resource
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
To note the similarities and differences between two or more things
To determine an approximate value for
To find the value using mathematics
To change from one form or purpose to another
To reach a conclusion or make a judgement through careful study
To give the meaning of / to construe or understand / to translate orally