How much loss may Lacy recognize

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Problem - Four GRRLs Partnership is owned by four girlfriends. Lacy holds a 40% interest; each of the others owns 20%. Lacy sells investment property to the partnership for its fair market value of $200,000 (Lacy's basis is $250,000).

Required -

a. How much loss, if any, may Lacy recognize?

b. If the partnership later sells the property for $260,000, how much gain must it recognize?

c. How would your answers in parts (a) and (b) change if Lacy owned a 60% interest in the partnership?

d. If Lacy owned a 60% interest and her basis in the investment property was $120,000 (instead of $250,000), how much, if any, gain would she recognize on the sale? How would the gain be characterized?

 

Reference no: EM132648164

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