39 Nelly received 25% capital and profit (loss) interest in Barcelona Limited Partnership (LP). In exchange for this interest, Nelly contributed a lot of land with an FMV of $42,000. Her adjusted basis in the real estate was $14,000. In addition, the building was encumbered with a $12,000 nonrecourse mortgage that Barcelona LP assumed at the time the property was contributed. What is Nelly's outside basis immediately after his contribution? Explain the rule and show computation.

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