Smith, Jones and Green are to be equal general partners in the SJG partnership. Smith transferred land with an adjusted basis of $405,000 and a FMV of $900,000 to the partnership. At the time of transfer, the land was encumbered by a $600,000 recourse debt, which had been incurred seven (7) years earlier. Jones contributed cash of $290,000 and Green contributed cash of $250,000 to the partnership. a) What is the partnership's inside basis in the land? b) What are the capital account balances for Smith, Jones and Green following the formation of the partnership? c) What is the outside balance for Smith, Jones and Green following the formation of the partnership?
Smith, Jones and Green are to be equal general partners in the SJG
a) What is the partnership's inside basis in the land?
b) What are the capital account balances for Smith, Jones and Green following the formation of the partnership?
c) What is the outside balance for Smith, Jones and Green following the formation of the partnership?
d) What is the amount of gain or loss, if any, that Smith must recognize as a consequence of his transfer of the land to the partnership?
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