The Dec. 31, 2006, balance sheet of the BCD General Partnership reads as follows.
Basis FMV
Cash $180,000 $180,000
Receivables 0 0
Capital assets 42,000 63,000
Total $222,000 $333,000
Ben, capital $74,000 $111,000
Cassie, capital 74,000 111,000
Deidra, capital 74,000 111,000
Total $222,000 $333,000
Each partner shares in 1/3 of the partnership capital, income, gain, loss, deduction and credit. Capital is not a material income-producing factor to the partnership. On Dec. 31, 2006, general partner Cassie receives a distribution of $120,000 cash in liquidation of her partnership interest under section 736. Nothing is stated in the partnership agreement about goodwill. Cassie's outside basis for the partnership interest immediately before the distribution is $74,000.
How much is Cassie's recognized gain from the distribution and what is the character of the gain?