Problem
I. Scott owns a 30% interest in the capital and profits of the SOS Partnership. Immediately before he loss receives a proportionate current (nonliquidating) distribution from SOS, the basis of his partnership interest is $40,000. The distribution consists of $30,000 in cash and land with a fair market value of 20. [$80,000. SOS's adjusted basis in the land immediately before the distribution is $50,000. As a result of the distribution, does Scott recognize gain or loss and how much? What is Scott's basis in the land?
II. Lori, a partner in the JKL partnership, received a proportionate current (nonliquidating) distribution of $10,000 cash, unrealized receivables with a basis of $0 and a fair market value of $15,000, and land with a basis of $6,000 and a fair market value of $10,000. Her basis in the partnership interest immediately before the distributions was $14,000. How much gain will Lori recognize? What will her basis in the receivables be? In the land?