Milton has a basis in his partnership of $300,000, including his $80,000 share of partnership liabilities. At the end of the current year the partnership pays off the liabilities and makes a proportionate current distribution to its partners. Milton receives a parcel of land (partnership

Milton has a basis in his partnership of $300,000, including his $80,000 share of partnership liabilities. At the end of the current year the partnership pays off the liabilities and makes a proportionate current distribution to its partners. Milton receives a parcel of land (partnership

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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Ann, Beth, Chris and Dan are equal partners in the ABCD. They have agreed that all items of partnership income, gain, loss and deduction will be split equally between them. In addition, since Ann is expected to be rendering the majority of the services on behalf of the partnership, the partners have agreed that she will receive $3,000 per month in addition to her 25% distributive share. For the year 2020, the partnership had short-term capital loss of $28,000, long-term capital gain of $54,000 and bottom line ordinary income (before considering the additional payments to Ann) of $21,000. What is the amount and character of partnership income and loss that Ann, Beth, Chris and Dan must include from the ABCD partnership on their 2020 income tax returns?
Partner Bob’s basis in his partnership interest is $50,000. What gain or loss is recognized, and what are Bob’s basis in the property received and his basis in his partnership interest, if the partnership makes the following independent proportionate nonliquidating distributions? Partnership distributes $40,000 in cash. Partnership distributes $60,000 cash. Partnership distributes $40,000 cash and accrual basis accounts receivable with a $20,000 basis and value.
Partner Bob’s basis in his partnership interest is $50,000. What gain or loss is recognized, and what are Bob’s basis in the property received and his basis in his partnership interest, if the partnership makes the following independent proportionate nonliquidating distributions? Partnership distributes $8,000 of inventory value with a $5,000 basis. Partnership distributes two parcels of land, each with a value of $30,000. The partnership’s basis in parcel A is $40,000 and in parcel B is $20,000.
Jenna began the year with a tax basis of $21,000 in her partnership interest. Her share of partnership liabilities consists of $9,000 of recourse liabilities and $11,000 of nonrecourse liabilities at the beginning of the year and $9,000 of recourse liabilities and $13,000 of nonrecourse liabilities at the end of the year. During the year, she was allocated $31,000 of partnership ordinary business loss. Jenna does not materially participate in this partnership, and she has $8,000 of passive income from other sources. How much of Jenna’s loss is limited by her tax basis? How much of Jenna’s loss is limited by her at-risk amount? How much of Jenna’s loss is limited by the passive activity loss rules? Please subparts answer fast i give positive rating and without plagiarism no plagiarism please
Jenna began the year with a tax basis of $22,000 in her partnership interest. Her share of partnership liabilities consists of $3,000 of recourse liabilities and $12,000 of nonrecourse liabilities at the beginning of the year and $3,000 of recourse liabilities and $14,000 of nonrecourse liabilities at the end of the year. During the year, she was allocated $36,000 of partnership ordinary business loss. Jenna does not materially participate in this partnership, and she has $5,000 of passive income from other sources. b. How much of Jenna’s loss is limited by her at-risk amount?
On January 1, 2021, Bob purchased a 50 percent interest in ABC Partnership (ABC) from Tim by paying Tim $150,000 in cash. During 2021, ABC had ordinary income totaling $180,000 and paid a penalty to the state of Virginia in the amount of $1,000. ABC, which does not have any liabilities, made a distribution to its partners on December 31, 2021 in the total amount of $50,000. The ABC partnership agreement requires all income, gains, and losses to be allocated between Bob and his partner based on ownership interest or 50/50. Required: 1. Calculate Bob's tax basis in ABC partnership interest on December 31, 2021. 2. If Bob sold his entire interest to Jack on January 1, 2022 for $200,000, calculate Bob's gain or loss on the sale assuming that ABC at the time of the sale did not have any "Hot Assets".
Shirley contributes property to a new partnership with a value of $1,000,000 and a basis of $400,000 that is secured by a $500,000 nonrecourse note. Under the terms of the partnership agreement, Shirley will be allocated 25% of all profits. The partnership agreement also states that "excess nonrecourse liabilities" will be allocated to partners according to profit ratios. How much of the nonrecourse liability will be allocated to Shirley? please dont provide answer in images thank you
Cheryl and Joseph formed a partnership. Cheryl received a 50% interest in partnership capital and profits in exchange for contributing land with a basis of $140,000 and a fair market value of $300,000. Joseph received a 50% interest in partnership capital and profits in exchange for contributing $300,000 of cash. Three years after the contribution date, the land contributed by Cheryl is sold by the partnership to a third party for $380,000. How much taxable gain will Cheryl recognize from the sale? a) $40,000 b) $120,000 c) $160,000 d) $200,000 e) None of the above
Amy and Mitchell are equal partners in the accrual basis AM Partnership.At the beginning of the current year, Amys capital account has a balance of $300,000, and the partnership has recourse debts of $200,000 payable to unrelated parties. Assume that all partnership recourse debt is shared equally between the partners. The following information about AMs operations for the current year is obtained from the partnerships records.Ordinary income$400,000Interest income$4,000Long-term capital loss$6,000Short-term capital gain$12,000Charitable contribution$4,000Cash distribution to Amy$20,000Assume that year-end partnership debt payable to unrelated parties is $140,000. If all transactions are reflected in her beginning capital and basis in the same manner, what is Amy basis in the partnership interest:At the beginning of the year?At the end of the year?What income, gains, losses, and deductions does Amy report on her income tax return?Based on the information provided, what other…
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Misha receives a proportionate nonliquidating distribution when the basis of her partnership interest is $60,000. The distribution consists of $80,000 cash and inventory (adjusted basis to the partnership of $10,000, fair market value of $20,000). How much gain or loss does Misha recognize, and what is her basis in the distributed inventory and in her partnership interest following the distribution?
This year, Alex’s distributive share from Eden Lakes Partnership includes $8,000 of interest income, $4,000 of net long-term capital gains, $2,000 net §1231 gain from the sale of property used in the partnership’s trade or business, and $83,000 of ordinary business income.a. Assume that Alex materially participates in the partnership. How much of his distributive share from Eden Lakes Partnership is potentially subject to the net investment income tax?