Description
Chuck has an outside basis of $190,000 in the Forest Partnership as of December 31 of the current year. On that date the partnership liquidates and distributes to Chuck a proportionate distribution of $140,000 cash and inventory with an inside basis to the partnership of $10,000 and a fair market value of $30,000. In addition, Chuck receives a desk which has an inside basis and fair market value of $3,400 and $4,600, respectively. None of the distribution is for partnership goodwill. How much gain or loss will Chuck recognize on the distribution, and what basis will he take in the desk?
A.$36,600 loss; $3,400 basis.
B. $35,400 loss; $4,600 basis.
C. $15,400 loss; $4,600 basis.
D. $0 loss; $40,000 basis.
Harper is a partner in a continuing partnership. At the end of the current year, the partnership distributed to Harper in a proportionate, nonliquidating distribution cash of $50,000, inventory with a basis to the partnership of $45,000 and a fair market value of $80,000, and a parcel of land with a basis to the partnership of $130,000 and a fair market value of $90,000. Harper’s basis in the partnership interest was $260,000 before the distribution. What basis does Harper take in the inventory and land, and what is his basis in the partnership interest following the distribution?
A. $45,000 basis in inventory; $90,000 basis in land; $75,000 basis in partnership.
B. $45,000 basis in inventory; $130,000 basis in land; $35,000 basis in partnership.
C. $80,000 basis in inventory; $90,000 basis in land; $40,000 basis in partnership.
D. $80,000 basis in inventory; $130,000 basis in land; $20,000 basis in partnership.
Kenneth receives a proportionate, nonliquidating distribution from the Fern Partnership. The distribution consists of $10,000 cash and property with an adjusted basis to the partnership of $40,000 and a fair market value of $58,000. Immediately before the distribution, Kenneth’s adjusted basis for his partnership interest is $75,000. Kenneth’s basis in the noncash property received is:
A. $25,000
B. $40,000
C. $58,000
D. $65,000
A.$36,600 loss; $3,400 basis.
B. $35,400 loss; $4,600 basis.
C. $15,400 loss; $4,600 basis.
D. $0 loss; $40,000 basis.
Harper is a partner in a continuing partnership. At the end of the current year, the partnership distributed to Harper in a proportionate, nonliquidating distribution cash of $50,000, inventory with a basis to the partnership of $45,000 and a fair market value of $80,000, and a parcel of land with a basis to the partnership of $130,000 and a fair market value of $90,000. Harper’s basis in the partnership interest was $260,000 before the distribution. What basis does Harper take in the inventory and land, and what is his basis in the partnership interest following the distribution?
A. $45,000 basis in inventory; $90,000 basis in land; $75,000 basis in partnership.
B. $45,000 basis in inventory; $130,000 basis in land; $35,000 basis in partnership.
C. $80,000 basis in inventory; $90,000 basis in land; $40,000 basis in partnership.
D. $80,000 basis in inventory; $130,000 basis in land; $20,000 basis in partnership.
Kenneth receives a proportionate, nonliquidating distribution from the Fern Partnership. The distribution consists of $10,000 cash and property with an adjusted basis to the partnership of $40,000 and a fair market value of $58,000. Immediately before the distribution, Kenneth’s adjusted basis for his partnership interest is $75,000. Kenneth’s basis in the noncash property received is:
A. $25,000
B. $40,000
C. $58,000
D. $65,000
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