Cliff’s basis in his Aero Partnership interest is $18,500. Cliff receives a distribution of $24,100 cash...
Cliff’s basis in his Aero Partnership interest is $18,500. Cliff
receives a distribution of $24,100 cash from Aero in complete
liquidation of his interest. Aero is an equal partnership with the
following balance sheet:
| Tax Basis | FMV | |||||
| Assets: | ||||||
| Cash | $ | 24,100 | $ | 24,100 | ||
| Investment | 28,800 | 28,800 | ||||
| Land | 2,600 | 36,700 | ||||
| Totals | $ | 55,500 | $ | 89,600 | ||
| Liabilities and capital: | ||||||
| Capital | – Chris | 18,500 | ||||
| – Cliff | 18,500 | |||||
| – Cooper | 18,500 | |||||
| Totals | $ | 55,500 | ||||
b. If Aero has a §754 election in place, what is the amount of the special basis adjustment?
Special Basis Adjustment:
Increase decrease or none?
Homework Answers
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Cliff’s basis in his Aero Partnership interest is $18,500. Cliff
receives a distribution of $24,100 cash...
hapter 21 Problems Saved 25 [The following information applies to the questions displayed below Cliff's basis...
hapter 21 Problems Saved 25 [The following information applies to the questions displayed below Cliff's basis in his Aero Partnership interest is $13,700. Clff receives a distribution of $29,900 cash from Aero in complete liquidation of his interest. Aero is an equal partnership with the following balance sheet art 1 of 2 Тах Basis FMV Assets: Cash $ 29,900 $29,900 7,900 7,900 3,300 42,700 41,100 $80,5ee 57 nts Investment Land $ Totals eBook Liabilities and capital: Capital Hint 13,700 13,780...
Kathy is a 25 percent partner in the KDP Partnership and receives a parcel of land...
Kathy is a 25 percent partner in the KDP Partnership and receives a parcel of land with a fair value of $157,000 (inside basis of $114,000) in complete liquidation of her partnership interest. Kathy's outside basis immediately before the distribution is $207,000. KDP currently has a §754 election in effect and has no hot assets or liabilities. What is KDP's special basis adjustment from the distribution? Multiple Choice a) $93,000 positive basis adjustment. b) $0. c) $43,000 positive basis adjustment....
Interest is $50,000. His distribution includes cash of $5,000, inventory (FMV -$20,000; basis $10...
interest is $50,000. His distribution includes cash of $5,000, inventory (FMV -$20,000; basis $10,000), and equipment (FMV $2,000; basis $1,000). Sam's marginal tax rate is 24% and his long-term capital gains tax rate is 15%. 2. Sam receives a proportionate nonliquidating distribution when the basis of his partnership a. How much gain or loss does Sam recognize? Gain /Loss) b. What is Sam's tax liability/benefit on the distribution? (Liability /Benefit) c. What is Sam's basis in the inventory? d. What...
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Erin’s interest in the EPG Partnership is liquidated when his basis in the interest is $30,000....
Erin’s interest in the EPG Partnership is liquidated when his basis in the interest is $30,000. He receives a liquidating distribution of $20,000 cash and inventory with a basis of $8,000 and an FMV of $30,000. Erin will recognize A) no gain or loss. B) $2,000 capital loss. C) $2,000 ordinary loss. D) $10,000 capital loss and $20,000 ordinary loss.
Travis and Alix Weber are equal partners in the Tralix Partnership, which does not have a...
Travis and Alix Weber are equal partners in the Tralix Partnership, which does not have a §754 election in place. Alix sells one-half of her interest (25 percent) to Michael Tomei for $39,500 cash. Just before the sale, Alix’s basis in her entire partnership interest is $79,750, including her $39,500 share of the partnership liabilities. Tralix’s assets on the sale date are as follows: Tax Basis FMV Cash $ 48,550 $ 48,550 Inventory 39,500 128,000 Land held for investment 84,750...
Partner Z of the XYZ partnership receives a liquidating distribution of the following: Basis FMV Cash...
Partner Z of the XYZ partnership receives a liquidating distribution of the 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?Answer 1. There is no gain or...
Parker’s basis in his PQ Partnership interest is $180,000. Parker receives a pro rata liquidating distribution...
Parker’s basis in his PQ Partnership interest is $180,000. Parker receives a pro rata liquidating distribution consisting of $20,000 cash, land with a basis of $80,000 and a fair market value of $100,000, and his proportionate share of inventory with a basis of $60,000 to PQ and a fair market value of $75,000. Assume that PQ also liquidates. How much gain or loss, if any, must Parker recognize on the distribution? What basis will Parker take in the inventory and...
Required information The following information applies to the questions displayed below) 1 of 4 Travis and Alix...
Required information The following information applies to the questions displayed below) 1 of 4 Travis and Alix Weber are equal partners in the Tralix Partnership, which does not have a $754 election in place. Allx sells one-half of her interest (25 percent) to Michael Tomei for $31,000 cash. Just before the sale, Alix's basis in her entire partnership interest is $76,200, including her $31,000 share of the partnership liabilities. Tralix's assets on the sale date are as follows: Book FMV...
Problem 11-35 (LO. 3) Jamie's basis in her partnership interest is $52,000. In a proportionate distribution...
Problem 11-35 (LO. 3) Jamie's basis in her partnership interest is $52,000. In a proportionate distribution in liquidation of the partnership, Jamie receives $2,000 cash and two parcels of land with bases of $10,000 and $18,000, respectively, each to the partnership. The partnership holds both parcels of land for investment, and the parcels have fair market values of $20,000 each. If there is no gain or loss or if an amount is zero, enter"0". a. How much gain or loss,...
hapter 21 Problems Saved 25 [The following information applies to the questions displayed below Cliff's basis in his Aero Partnership interest is $13,700. Clff receives a distribution of $29,900 cash from Aero in complete liquidation of his interest. Aero is an equal partnership with the following balance sheet art 1 of 2 Тах Basis FMV Assets: Cash $ 29,900 $29,900 7,900 7,900 3,300 42,700 41,100 $80,5ee 57 nts Investment Land $ Totals eBook Liabilities and capital: Capital Hint 13,700 13,780...
interest is $50,000. His distribution includes cash of $5,000, inventory (FMV -$20,000; basis $10,000), and equipment (FMV $2,000; basis $1,000). Sam's marginal tax rate is 24% and his long-term capital gains tax rate is 15%. 2. Sam receives a proportionate nonliquidating distribution when the basis of his partnership a. How much gain or loss does Sam recognize? Gain /Loss) b. What is Sam's tax liability/benefit on the distribution? (Liability /Benefit) c. What is Sam's basis in the inventory? d. What...
Required information The following information applies to the questions displayed below) 1 of 4 Travis and Alix Weber are equal partners in the Tralix Partnership, which does not have a $754 election in place. Allx sells one-half of her interest (25 percent) to Michael Tomei for $31,000 cash. Just before the sale, Alix's basis in her entire partnership interest is $76,200, including her $31,000 share of the partnership liabilities. Tralix's assets on the sale date are as follows: Book FMV...
Problem 11-35 (LO. 3) Jamie's basis in her partnership interest is $52,000. In a proportionate distribution in liquidation of the partnership, Jamie receives $2,000 cash and two parcels of land with bases of $10,000 and $18,000, respectively, each to the partnership. The partnership holds both parcels of land for investment, and the parcels have fair market values of $20,000 each. If there is no gain or loss or if an amount is zero, enter"0". a. How much gain or loss,...
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