In the prior course, Taxation of Business Entities One, you learned that C corporations are subject to an entity level income tax. Conversely, unincorporated organizational forms, such as partnerships are merely alter egos for their owners, that do not pay entity level tax on business income. Instead the income, losses, deductions, and credits pass through, and are reported and taxed at the owner level. This module begins our examination of the US federal tax treatment of partnerships. In the first lesson, you will learn about the background and basic concepts of partnerships, including the definition of a partnership, the conceptual framework that governs nearly every tax rule for partnerships, and special basis concepts that facilitate the single layer of taxation. From here, the discussion shifts from the generalities to important tax rules pertaining to the partnership lifecycle. In particular, the next four lessons focus on partnership formation. By examining the non-recognition provision for contributions of property in exchange for partnership interest, basis and holding period provisions, major exceptions to the non-recognition provision, and several elections and tax treatments applying to newly formed partnerships. Most lessons are separated into concepts and applications using Sunchaser Shakery.