[The following information applies to the questions displayed below.] The Taurin Partnership (a calendar-year-end entity) has the following assets as of December 31 of the current year: Tax Basis FMV Cash $ 46,200 $ 46,200 Accounts receivable 15,400 30,800 Inventory 82,500 122,100 Totals $ 144,100 $ 199,100 On December 31, Taurin distributes $15,400 of cash, $10,267 (FMV) of accounts receivable, and $40,700 (FMV) of inventory to Emma (a one-third partner) in termination of her partnership interest. Emma’s basis in her partnership interest immediately prior to the distribution is $40,883. c1. If Emma’s basis before the distribution was $56,258 rather than $40,883, what is Emma’s recognized gain or loss? c2. What is her basis in the distributed assets?
[The following information applies to the questions displayed below.] The Taurin Partnership (a calendar-year-end entity) has the following assets as of December 31 of the current year: Tax Basis FMV Cash $ 46,200 $ 46,200 Accounts receivable 15,400 30,800 Inventory 82,500 122,100 Totals $ 144,100 $ 199,100 On December 31, Taurin distributes $15,400 of cash, $10,267 (FMV) of accounts receivable, and $40,700 (FMV) of inventory to Emma (a one-third partner) in termination of her partnership interest. Emma’s basis in her partnership interest immediately prior to the distribution is $40,883. c1. If Emma’s basis before the distribution was $56,258 rather than $40,883, what is Emma’s recognized gain or loss? c2. What is her basis in the distributed assets?
Chapter21: Partnerships
Section: Chapter Questions
Problem 49P
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[The following information applies to the questions displayed below.] The Taurin Partnership (a calendar-year-end entity) has the following assets as of December 31 of the current year: Tax Basis FMV Cash $ 46,200 $ 46,200 Accounts receivable 15,400 30,800 Inventory 82,500 122,100 Totals $ 144,100 $ 199,100 On December 31, Taurin distributes $15,400 of cash, $10,267 (FMV) of accounts receivable, and $40,700 (FMV) of inventory to Emma (a one-third partner) in termination of her partnership interest. Emma’s basis in her partnership interest immediately prior to the distribution is $40,883.
c1. If Emma’s basis before the distribution was $56,258 rather than $40,883, what is Emma’s recognized gain or loss?
c2. What is her basis in the distributed assets?
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