Are federal income taxes payable by Deer Solution, or are they provided for by the Partnership?

According to Deer Solution's 2025 Franchise Disclosure Document, federal income taxes are not payable by the Partnership, nor are they provided for by the Partnership. Instead, the partners are taxed individually on their share of the Partnership's earnings. The net revenue of the Partnership is allocated on a pro-rata basis according to the partners' interests, after accounting for any guaranteed payments to partners.

This means that Deer Solution franchisees who operate as partnerships will not have the business itself pay federal income taxes. Instead, each partner will report their share of the business's profits or losses on their individual tax returns. This is a common practice for partnerships, as it avoids double taxation (where the business is taxed on its profits, and then the owners are taxed again when they receive distributions).

Prospective Deer Solution franchisees should consult with a tax advisor to understand the implications of this structure for their individual tax situations. They should also inquire about how the Partnership's net revenue is allocated and what constitutes 'partner guaranteed payments,' as these factors will affect each partner's tax liability.