What is Emma tax basis in her partnership interest

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Problem - Emma and Laine form the equal EL Partnership. Emma contributes cash of $100,000. Laine contributes property with an adjusted basis of $40,000 and a fair market value of $100,000.

Required -

a. How much gain, if any, must Emma recognize on the transfer? Must Laine recognize any gain? If so, how much?

b. What is Emma's tax basis in her partnership interest? Her § 704(b) book basis?

c. What is Laine's tax basis in her partnership interest? Her § 704(b) book basis?

d. What tax basis does the partnership take in the property transferred by Laine?

e. How will the partnership account for the difference between the basis and value of the property transferred by Laine?

Reference no: EM132663219

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