aranteed by any of the L of the nonrecourse debt i
Chapter10: Partnerships: Formation, Operation, And Basis
Section: Chapter Questions
Problem 26CE
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![Jokan contributes a nondepreciable asset to the Mahall LLC in exchange for a one-fourth (25%) interest in the LLC's capital and profits
and a 30% interest in the LLC's losses. The asset has an adjusted tax basis to Jokan and the LLC of $117,500 and a fair market value
and § 704(b) "book" basis on the contribution date of $211,500. The asset is encumbered by a nonrecourse note of $70,500 that has
not been guaranteed by any of the LLC members.
How much of the nonrecourse debt is allocated to Jokan?
What is the amount of Jokan's basis in the LLC interest following the contribution?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe17b9f64-47b8-405b-a56c-289d3db4ba38%2F56439d6a-a730-4120-93cc-6bdc839c3d6a%2Fxptnpz9_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Jokan contributes a nondepreciable asset to the Mahall LLC in exchange for a one-fourth (25%) interest in the LLC's capital and profits
and a 30% interest in the LLC's losses. The asset has an adjusted tax basis to Jokan and the LLC of $117,500 and a fair market value
and § 704(b) "book" basis on the contribution date of $211,500. The asset is encumbered by a nonrecourse note of $70,500 that has
not been guaranteed by any of the LLC members.
How much of the nonrecourse debt is allocated to Jokan?
What is the amount of Jokan's basis in the LLC interest following the contribution?
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