What is ajs basis in the distributed assets

Reference no: EM133416678

Question: AJ is a 30 percent partner in the Trane Partnership, a calendar-year-end entity. On January 1, AJ has an outside basis in his interest in Trane of $76,500, which includes his share of the $52,800 of partnership liabilities. Trane generates $43,400 of income during the year and does not make any changes to its liabilities. On December 31, Trane makes a proportionate distribution of the following assets to AJ to terminate his partnership interest:

               Tax Basis   FMV
Inventory $ 58,500    $ 69,200
Land         31,400      25,700
Totals       $ 89,900     $ 94,900

a. What are the tax consequences (gain or loss, basis adjustments) of the distribution to Trane?

b. What are the amount and character of any recognized gain or loss to AJ?

c. What is AJs basis in the distributed assets?

d. If AJ sells the inventory four years after the distribution for $74,200, what are the amount and character of his recognized gain or loss?

Reference no: EM133416678

Questions Cloud

Explain relevant legislation and case law using property law : The proceeds split equally between Bill and himself. Explain the answer by reference to relevant legislation and case law using property law.

What is the most polluted state : Should environmental regulations, in US, be loosened to create more jobs, or tightened to improved quality of life? #2. Where is Cancer Alley, Texas?

Which of the three publics do you believe : While reaching each of these publics plays an important role in achieving success in public relations and advertising programming, which of the three publics

Explain why change could have dramatic effects : Explain why a change could have dramatic effects on the 50 United States of America.

What is ajs basis in the distributed assets : What are the tax consequences (gain or loss, basis adjustments) of the distribution to Trane and What are the amount and character of any recognized gain

Why would you look at antigua and barbuda from a pluralist : Why would you look at Antigua and Barbuda from a pluralist perspective in relations to business power? Give reasons for your answer and provide examples.

Imposing lower tariffs on imported goods : Imposing lower tariffs on imported goods, as an act of protectionism policy, would benefit the Philippines.

What are positive and negative effects of social media : What are positive and negative effects of social media? I grew up in the 1950s and 1960s, when television was still new.

Explain the reasons for your objectives : determine whether an advertising campaign has been effective it's important to see clear concise objectives. The textbook refers to a range of advertising

User Account

All Pages