At the end of last year, June, a 30% partner in the four-person BJJM Partnership, had an outside basis of $75,000 in the partnership, including a $60,000 share of partnership debt. June's share of the partnership's § 1245 recapture potential was $40,000. All parties use the calendar year. Identify the income tax consequences to June in each of the following independent situations that take place in the current year. a. On the first day of the tax year, June sells her partnership interest to Marilyn for $120,000 cash and the assumption by Marilyn of the appropriate share of partnership liabilities. June's total gain is s , consisting of a capital gain of $ Feedback and ordinary income of $ Check My Work A partnership interest is a capital asset and generally results in capital gain or loss on disposal. b. June dies after a lengthy illness on April 1 of the current year. June's brother immediately takes June's place in the partnership. The transfer of a partnership interest as a result of death is not considered ✓ a sale or exchange. Thus, no gain or loss ✓ results.
At the end of last year, June, a 30% partner in the four-person BJJM Partnership, had an outside basis of $75,000 in the partnership, including a $60,000 share of partnership debt. June's share of the partnership's § 1245 recapture potential was $40,000. All parties use the calendar year. Identify the income tax consequences to June in each of the following independent situations that take place in the current year. a. On the first day of the tax year, June sells her partnership interest to Marilyn for $120,000 cash and the assumption by Marilyn of the appropriate share of partnership liabilities. June's total gain is s , consisting of a capital gain of $ Feedback and ordinary income of $ Check My Work A partnership interest is a capital asset and generally results in capital gain or loss on disposal. b. June dies after a lengthy illness on April 1 of the current year. June's brother immediately takes June's place in the partnership. The transfer of a partnership interest as a result of death is not considered ✓ a sale or exchange. Thus, no gain or loss ✓ results.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Problem 11-49 (LO. 7, 8, 10)
At the end of last year, June, a 30% partner in the four-person BJJM Partnership, had an outside basis of $75,000 in the partnership,
including a $60,000 share of partnership debt. June's share of the partnership's § 1245 recapture potential was $40,000. All parties use the
calendar year.
Identify the income tax consequences to June in each of the following independent situations that take place in the current year.
a. On the first day of the tax year, June sells her partnership interest to Marilyn for $120,000 cash and the assumption by Marilyn of the
appropriate share of partnership liabilities.
June's total gain is $
Feedback
▼ Check My Work
consisting of a capital gain of $
and ordinary income of $
A partnership interest is a capital asset and generally results in capital gain or loss on disposal.
b. June dies after a lengthy illness on April 1 of the current year. June's brother immediately takes June's place in the partnership.
The transfer of a partnership interest as a result of death is not considered ✓ a sale or exchange. Thus, no gain or loss ✓
results.
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