In tax year 2021, a married taxpayer with AGI of $300,000 had gross investment income of $6,150 (which included a long-term capital gain of $3,500 and interest income of $2,650), brokerage commissions of $75, and tax preparation fees of $210. Calculate the amount of net investment income tax the taxpayer is required to pay

Part a.

Rosa and Miranda are running a Partnership

Part b.

Smoothie Sensations is a Franchisor

Explanation:

Partnership

The Partnership Act of 1890 defines a partnership as a relationship which exists between persons carrying on  business in common  with a view of profit. Common characteristic of a Partnership include an agreement by partners to each subscribe an amount of capital in the business and the sharing of profits and loses of the business. Rosa and Miranda are in a Partnership business as they take up most of the characters of this business.

Franchisor

A Franchisor is an original and existing business which sells the right to open stores, and sell products or services using its brand, expertise and intellectual property. This is a strategy used by many businesses to grow externally or market themselves. Smoothie Sensations decides to sell the right to use its brand name and product to others who  will open these shops, thus it is running a franchise.