Question

Matt’s outside basis in the partnership is $50,000 and Matt receives cash of $20,000 from the partnership upon complete proportionate liquidation. He also receives some inventory, basis $10,000, (FMV of $15,000). Matt loved the receptionist desk used for the business and Matt manages to get the desk as well upon the liquidation. The partnership’s adjusted basis in the desk is $200.

a) How much capital loss, would Matt recognize on her tax return because of the liquidation?

b) How much basis Matt will have in the inventory and the desk?

Answer #1

given that

Matt’s outside basis in the partnership is $50,000 and Matt
receives cash of $20,000 from the partnership upon complete
proportionate liquidation

also given that

He also receives some inventory, basis $10,000, (FMV of
$15,000).

mentioned that

Matt loved the receptionist desk used for the business and Matt
manages to get the desk as well upon the liquidation.

The partnership’s adjusted basis in the desk is $200

a) How much capital loss, would Matt recognize on her tax return
because of the liquidation?

Since Alley's invested capital was $50,000 and she received $20,000
at liquidation. So she'll recognize $30,000 loss in the her tax
return.

b) How much basis Matt will have in the inventory and the
desk?

The same she had in the Equity of the company. In this case
Alleys's basis in inventory is $15,000 which is the fair market
value and in desk is $200

Paula's basis in her partnership interest is $60,000. in
liquidation of her interest, the partnership make a proportionate
distribution to paula of $20,000 of cash, and inventory (basis of
$5,000 and value of $7,000). (Assume the partnership also
liquidates.)
a. How much gain or loss, if any, will Paula recognize on the
distribution?
b. What basis will Paula take in the inventory?
c. What are the tax consequences to the partnership?
d. Can you recommend an alternative distribution? Explain.
e....

Gary's basis in his interest in the GAR Partnership is $24,000.
In complete liquidation fo his interest, Gary receives cash of
$4,000 and land having a FMV of $40,000 and an inside basis of
$15,000. a. How much gain or loss, if any, does Gary recognize for
tax purposes b. What is Gary's basis in the land after
distribution?

1. In complete liquidation of her interest in
the Buyers Partnership, Sarah received a cash distribution of
$40,000. Her basis in the partnership interest prior to receipt of
the liquidating distribution was $48,000.
a). How much gain or loss must Sarah recognize on
receipt of the liquidating distribution? b).
Assume that Sarah received cash of only $25,000, and property worth
$15,000 in complete liquidation of her interest in
the partnership. How much gain or loss would she recognize? What
would...

15. Dalia has a 25% interest in the DQ partnership. Her
outside basis is $500. The partnership liquidates distributing to
Dalia $300 in cash and inventory with an inside basis of
$125.
a. Does Dalia recognize gain or loss on the
distribution? If yes, how much gain or loss and what is the
character?
b. What Dalia’s basis is in the inventory
16. Suppose Dalia from the previous problem receives $300 in
cash but the inside basis of the inventory...

Partner A received the following in a non-liquidating
distribution:
Basis FMV
Cash
$20,000 $20,000
Inventory Item
1 $15,000 $18,000
Inventory Item
2 $12,000 $4,000
Capital Asset
1 $15,000
$8,000
Capital Asset 2 $10,000 $20,000
$72,000 $70,000
Assume A’s basis in the partnership before the distribution was
$35,000. What would the bases of the assets be to A?

Partners A and B form a partnership where each receive a 50%
interest in capital and profits. Partner A contributes cash of
$25,000 and land valued at $25,000. Partner A has a basis in the
land of $20,000 and has held it for two years. Partner B
contributes equipment (with a basis to B of $15,000 and a fair
market value of $30,000) and inventory (with a basis to B of
$10,000 and a fair market value of $20,000). Partner...

Partners A and B form a partnership where each receive a 50%
interest in capital and profits. Partner A contributes cash of
$25,000 and land valued at $25,000. Partner A has a basis in the
land of $20,000 and has held it for two years. Partner B
contributes equipment (with a basis to B of $15,000 and a fair
market value of $30,000) and inventory (with a basis to B of
$10,000 and a fair market value of $20,000). Partner...

Joe, Kate, and Lisa form an equal 1/3 each partnership. Joe
contributes land FMV of $20,000 (basis $15,000) and land was a
Section 1231 asset previously. Kate contributes inventory FMV
$10,000 (basis $7,500) and cash of $10,000. Lisa contributes
equipment that she has depreciated over the past two years in an
unrelated business. She bought the equipment for $24,000 and has
taken $12,000 in depreciation. The FMV of it is $20,000 at the time
of her contribution.
What basis and...

Sue and Andrew form SA general partnership. Each person receives
an equal interest in the newly created partnership. Sue contributes
$27,000 of cash and land with a FMV of $72,000. Her basis in the
land is $37,000. Andrew contributes equipment with a FMV of $29,000
and a building with a FMV of $50,000. His basis in the equipment is
$25,000, and his basis in the building is $37,000. How much gain
must the SA general partnership recognize on the transfer...

Madison is a 35% partner in the Total Partnership, a
calendar-year-end entity. Madison has an outside basis in his
interest in Total Partnership of $198,000, which includes his share
of the $45,000 of partnership liabilities. On December 31, Total
makes a proportionate distribution of the following assets to
Madison:
BASIS
FMV
Cash
$50,000
$50,000
Inventory
$65,000
$75,000
Land
$50,000
$65,000
Totals
$165,000
$180,000
For an operating distribution, outline the tax consequences
(amount and character of recognized gain or loss, basis...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 2 minutes ago

asked 5 minutes ago

asked 14 minutes ago

asked 22 minutes ago

asked 26 minutes ago

asked 26 minutes ago

asked 27 minutes ago

asked 29 minutes ago

asked 35 minutes ago

asked 36 minutes ago

asked 38 minutes ago

asked 40 minutes ago