What is the partnership minimum gain

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QUESTION - A and B form partnership AB by contributing 100 and 150 respectively. The partnership agreement provides that all income and loss is allocated 40% to A and 60% to B. In year 1, the partnership borrows 300 on a non-recourse basis and buys property X for 400. It also purchases tax free state bonds for 150. The partnership earns income from property X of 80 and earns tax exempt interest of 50 on the bonds. The tax exempt bonds are sold for a loss of 10. There is a cash distribution of 60 to A. Over time, the basis of property X is reduced through depreciation deductions by 150. In addition, there is additional non-recourse financing with respect to property X of 75 that was distributed to the partners. What is the partnership minimum gain?

Reference no: EM133003481

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