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Kevan, Jerry, and Dave formed Albee LLC, with each member receiving a one-third capital and profits interest. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets and his nonrecourse debt on the land contributed is $210,000: Basis FMV Cash $15,000 $15,000 Land $120,000 $440,000 Totals $135,000 $455,000 What is Kevan's outside tax basis in his LLC interest? What outside tax basis do Jerry and Dave have in their LLC interests? Albee's tax basis in its assets? How much gain or loss will Jerry, Dave, and Kevan recognize? 22

Kevan, Jerry, and Dave formed Albee LLC, with each member receiving a one-third capital and profits interest. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets and his nonrecourse debt on the land contributed is $210,000: Basis FMV Cash $15,000 $15,000 Land $120,000 $440,000 Totals $135,000 $455,000 What is Kevan's outside tax basis in his LLC interest? What outside tax basis do Jerry and Dave have in their LLC interests? Albee's tax basis in its assets? How much gain or loss will Jerry, Dave, and Kevan recognize? 22

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Kevan, Jerry, and Dave formed Albee LLC, with each member receiving a one-third capital and profits interest. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets and his nonrecourse debt on the land contributed is $210,000: Cash Land Totals Basis FMV $15,000 $15,000 $120,000 $440,000 $135,000 $455,000 What is Kevan's outside tax basis in his LLC interest? What outside tax basis do Jerry and Dave have in their LLC interests? Albee's tax basis in its assets? How much gain or loss will Jerry, Dave, and Kevan recognize? 22
Transcribed Image Text:Kevan, Jerry, and Dave formed Albee LLC, with each member receiving a one-third capital and profits interest. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets and his nonrecourse debt on the land contributed is $210,000: Cash Land Totals Basis FMV $15,000 $15,000 $120,000 $440,000 $135,000 $455,000 What is Kevan's outside tax basis in his LLC interest? What outside tax basis do Jerry and Dave have in their LLC interests? Albee's tax basis in its assets? How much gain or loss will Jerry, Dave, and Kevan recognize? 22
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