What gain or loss would the partnership recognize

Reference no: EM132763088

Question: Keith has a 35?% interest in the KLM Partnership. Leonardo ?(Keith?'s ?son) also has a 20?% interest. An individual unrelated to either Keith or Leonardo holds the remaining 45?% interest. Keith sells the following assets to the partnership during the? year:

Common stock? (a capital asset held more than one? year) having a $12,000 basis and a $20,000 FMV and selling price.

• Land? (a Sec. 1231? asset) having a $103,000 adjusted basis and a $78,000 FMV and selling price.

• Machine having a $55,000 adjusted basis and a $91,000 FMV and selling price. The original cost of the machine was $69,000?, and Keith deducted $14,000 in MACRS depreciation before the transfer.

a. What are the amount and character of Keith?'s recognized gain or loss on the sale of the common? stock? The? land? The? machine?

b. What gain or loss would the partnership recognize if it sells the land two years later for $98,000??

Reference no: EM132763088

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