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william's basis in the WAM partnership interest wa...




william's basis in the WAM partnership interest was $100,000 just before he received a proportionate liquidating distribution consisting of investment land (basis of $30,000. fair market value $40,000), and inventory (basis $30,000, fair market value $70,000). After the distribution, William's recognized gain or loss and his basis in the land and inventory are: a. $40,000 loss; $30,000 (land); $30,000 (inventory) b. $10,000 gain; $40,000 (land); $70,000 (inventory) c. $0 gain or loss; $30,000 (land); $70,000 (inventory) d. $0 gain or loss; $70,000 (land); $30,000 (inventory) e. None of the above barry owns a 25% interest in a continuing partnership. the partnership distributes a $20,000 year-end cash bonus to all the partners. in a proportionate nonliquidating distribution, the partnership also distributed property (basis of $2,000; fair market value of $3,000) to barry. Immediately before the distribution, Barry's basis in the partnership interest was $30,000. As a result of the distribution, Barry recognizes: a. No gain or loss b. Ordinary loss of $7,000 c. Capital loss of $7,000 d. Ordinary loss of $8,000 e. Capital loss of $8,000 At the beginning of the year, Elsie's basis in the E&G Partnership interest is $60,000. She receives a proportionate nonliquidating distribution from the partnership consisting of $10,000 of cash, unrealized accounts receivable (basis of $0, fair market value $30,000), and inventory (basis of $10,000; fair market value of $20,000). After the distribution, Elsie's bases in the accounts receivable, and partnership interest are: a. $0; $10,000; and $40,000 b. $0; $20,000; and $30,000 c. $30,000; $10,000; and $10,000 d. $30,000; $20,000; and $0 e. None of the above Marcie is a 40% partner in the MAP Partnership. During the current tax year, the partnership reported ordinary income of $140,000 before payment of guaranteed payments and distributions to partners. The partnership made an ordinary cash distribution of $10,000 to Marcie, and paid guaranteed payments to partners Marcie, Alice, and Pat of $20,000 each ($60,000 total). How much will Marcie???s adjusted gross income increase as a result of the above items? a. $32,000 b. $52,000 c. $56,000 d. $76,000 e. None of the above


Paper#4822 | Written in 18-Jul-2015

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