What does the phrase “limited partner, as such” mean? There is no statute or regulation that defines the term. The tax code generally imposes self-employment tax on an individual’s share of income received from a What does the phrase “limited partner, as such” mean? There is no statute or regulation that defines the term. The tax code generally imposes self-employment tax on an individual’s share of income received from a partnership. But, under Section 1402(a)(13) of the tax code, the income of a “limited partner, as such” is excluded from self-employment tax. This exclusion is referred to as the limited partnership exclusion. Self-employment tax, a separate tax that is in addition to income tax, is the social security tax (12.4%) and Medicare tax (2.9%) imposed on an individual’s earnings.
Sirius Solutions, LLLP was a limited liability limited partnership which operated a business consulting firm. Sirius had one general partner and four limited partners. Sirius excluded the limited partners’ share of partnership income from its calculation of self-employment. The IRS asserted that the limited partners’ share of partnership income was subject to self-employment tax. In Sirius Solutions, LLLP v. Commissioner, 2026 WL 125600 (5th Cir. Jan. 16, 2026), the U.S. Court of Appeals for the Fifth Circuit ruled that the phrase “limited partner, as such” means a partner in a limited partnership that has limited liability. The Appeals Court based its decision on the standard...
PORTLAND, Maine (WGME) -- A week after employees at the Holy Donut on Park Avenue in Portland told the company they were looking to unionize, the company now says those workers made false accusati...