Sarah is a 50% partner in the SF Partnership and has an outside basis of $36,000 at the end of the year prior to any distributions. On December 31, Sarah receives a proportionate operating distribution of $50,000 cash. What is the amount of Sarah's recognized gain or loss on the distribution and what is her basis in her partnership interest after the distribution? Question 8 options: a) $0 gain, $36,000 basis. b) $14,000 gain, $0 basis. c) $50,000 gain, $36,000 basis. d) $14,000 gain, $36,000 basis e) $50,000 gain, $0 basis
Sarah is a 50% partner in the SF Partnership and has an outside basis of $36,000 at the end of the year prior to any distributions. On December 31, Sarah receives a proportionate operating distribution of $50,000 cash. What is the amount of Sarah's recognized gain or loss on the distribution and what is her basis in her partnership interest after the distribution? Question 8 options: a) $0 gain, $36,000 basis. b) $14,000 gain, $0 basis. c) $50,000 gain, $36,000 basis. d) $14,000 gain, $36,000 basis e) $50,000 gain, $0 basis
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Sarah is a 50% partner in the SF Partnership and has an outside basis of $36,000 at the end of the year prior to any distributions. On December 31, Sarah receives a proportionate operating distribution of $50,000 cash. What is the amount of Sarah's recognized gain or loss on the distribution and what is her basis in her partnership interest after the distribution?
Question 8 options:
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