Question

**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 be her basis in the property received?**

2. In complete liquidation of his interest in the KD Partnership, Scott received adistribution consisting of $38,000 cash and property valued at $62,000. The partnership’s tax basis in the property, which was not inventory or unrealized receivable,was $22,000. Scott’s basis in his partnership interest prior to receipt of the liquidating distribution was $35,000. The distribution was not a disproportionate distribution.

**a) Will Scott be required to recognize any gain or loss
for tax purposes upon receipt of the liquidating
distribution?**

**b) What will be his tax basis in the property received
from the partnership?**

Answer #1

Since, multiple questions have been posted, I have answered the first one.

_____

**1.**

Part a)

In the given case, the total amount of liquidating distribution of $40,000 is less than the Sarah's adjusted basis prior to the distribution which is $48,000. Therefore, Sarah will recognize capital loss equal to the value determined as below:

**Loss to be Recognized** = Adjusted Basis - Amount
Received = 48,000 - 40,000 = **$8,000**

_____

Part b)

As per the applicable rules, in a liquidation distribution, a loss is recognized only if the partner receives cash, unrealized receivables or inventory. In case, any other property is received, no loss will be recognized by Sarah.

**Loss to be Recognized** = **$0**

The adjusted basis of the property is determined as below:

**Adjusted Basis of Property** = Outside Basis -
Cash Received = 48,000 - 25,000 = **$23,000**

1. Wilma Clay and Nathan are equal partners in
the cousins partnership. At the end of the year, Wilma's tax basis
in her partnership interest was $14,000, clay's basis was $25,000
and Nathan’s basis $8,000. In a non-liquidating distribution, the
partnership distributed investment property to Clay with a tax
basis of $18,000 and a fair market value of $45,000.
a)How much gain must Clay recognize on receipt of the
distribution?
b) What basis will he take ii the property received...

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
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Partner Z of the XYZ
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following:
Basis
FMV
Cash
$40,000
$40,000
Inventory
$30,000
$45,000
Unrealized receiv.
$50,000
$45,000
1. Z’s basis in her
partnership interest was $95,000. What is her gain or loss and the
bases of the assets distributed to her?
2. Assume Z’s basis
in her partnership interest was $130,000. What is her gain or loss
and the bases of the assets distributed to her?
The capital
percentages are already factored...

The DJ Partnership has two? partners,Dawn and Jack.Each?
partner's basis in his or her partnership interest is $9,000 before
any distribution. The partnership distributes $10,000 cash to Dawn
and $8,000 cash to Jack.
Requirements
a.
Assuming a current? distribution, determine for each partner?
(1) gain or loss recognized and? (2) basis in the partnership
interest after the distribution.
b.
Assuming a liquidating? distribution, determine each? partner's
gain or loss recognized.

Please explain the difference
1. Under which of the following circumstances will a partner
recognize a gain from a non-liquidating distribution?
a. A partner will never recognize a gain from a non-liquidating
distribution.
b. A partner will recognize a gain from a non-liquidating
distribution when the partnership distributes property other than
money with an inside basis greater than the partner's basis in the
partnership interest.
c. A partner will recognize a gain from a non-liquidating
distribution when the partnership distributes...

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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
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b) How...

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a. How much gain or loss, if any, does Amber realize on the
transfer? Does Amber recognize any gain or loss?
b. What is Scott’s basis in his LLC interest?
c. What is Amber’s basis in her LLC interest?
d. What basis does the LLC take in the property...

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FMV
Adjusted Basis
Appreciation (Depreciation)
Cash
$
409,750
$
409,750
Building
73,250
24,000
49,250
Land
336,500
397,500
(61,000)
Total
$
819,500
$
831,250
$
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cash but the inside basis of the inventory...

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