Partnership interest after the distribution


Jack receives a proportionate, non-liquidating distribution from the Colours Partnership. The distribution consists of $18,000 cash and a capital asset with an adjusted basis to the partnership of $12000 and a fair market value of $30,000. Immediately before the distribution, Jack's adjusted basis in his partnership interest is $70,000. Which of the following is correct regarding Jack's basis in the noncash property received and Jack's basis in his partnership interest after the distribution?

A: $12,000 basis in non-cash property and $40,000 basis in partnership interest

B: 30,000 basis in non-cash property and 50000 basis in partnership interest

C: $52000 basis in non-cash property and $0 basis in partnership interest

D: none of the above is correct

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Accounting Basics: Partnership interest after the distribution
Reference No:- TGS050024

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