Solution-Calculate Romer basis in his partnership interest

Calculate Romer basis in his partnership interest

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Reference no: EM132663353

Problem - The RB LLC is owned equally by Romer and Brad. At the beginning of the year, Romer's basis is $40,000 and Brad's is $32,000. RB reported the following income and expenses for the current tax year.

Net ordinary business income (loss) (Form 1065, page 1, line 28) ($64,000)

Long-term capital gains 12,000

Distribution to Brad (30,000)

Payment to Great Health Hospital for Romer's medical expenses (24,000)

a. Calculate Romer's basis in his partnership interest at the end of the year. Based on this calculation, what does Romer report on his tax return?

b. Make the same calculation for Brad. What will Brad report on his tax return?

Reference no: EM132663353

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Calculate Romer basis in his partnership interest

Reference no: EM132663353

Reference no: EM132663353

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