What are the clients chances of success

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Question 1a. What did your clients attempt to accomplish by setting up the transactions in the manner they proposed?

Question 1b. What are the clients' chances of success if they go ahead with the transactions as planned in spite of the ruling?

Question 2. Is the ruling correct in stating that no matter how the transactions are handled, other than as your clients proposed, the income tax results will be the same?

Question 3. If your clients decide to sell their partnership interest rather than going through with the proposed transactions: Can they alter the income tax results stated in the ruling by having the partnership use 60,000 of its cash to pay down the mortgage on the land in order to secure a release from the mortgage of 20% of the land, sell 20% of the land for a 200,000 note and mortgage to an unrelated third party, use the remaining cash to reduce current liabilities and then have Able, Bernstine, and Charles sell their partnership interest to Peters who would assume the remaining current liabilities and mortgage liability?

Reference no: EM132714830

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