What is Celia adjusted tax basis for partnership interest

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Question - Brandon and Celia are forming the BC Partnership. Brandon contributes $20,000 cash and Celia contributes nondepreciable property with an adjusted basis of $18,000 and a fair market value of $30,000. The property is subject to a $10,000 liability which is also transferred into the partnership and is shared equally by the partners for basis purposes. Brandon and Celia share in all partnership profits equally except for any precontribution gain which must be allocated according to the statutory rules required for built-in gain allocations.

a. What is Celia's adjusted tax basis for her partnership interest immediately after the partnership is formed?

b. What is the partnership's adjusted basis for the property contributed by Celia?

c. If the partnership sells the property contributed by Celia for $35,000, how is the tax gain allocated between the partners?

Reference no: EM132902832

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