What is the basis to the partnership of each asset

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Dennis, Suzy, and Katherine form a partnership. Dennis and Suzy give equipment and a building, respectively. Katherine agrees to perform all of the accounting and office work in exchange for a 10% interest.

                                    FMV                 Basis           Partnership %
Dennis's equipment        $52,500              $10,500       45%
Suzy's building               $52,500               $42,000      45%
Katherine's services         $0                         $0               10%

Problem 1: What amount of gain, if any, do each of the partners recognize?

Problem 2: What is the basis for each partner in his or her partnership interest?

Problem 3: What is the basis to the partnership of each asset?

Reference no: EM132833711

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