Assume the same facts as in Problem 39, except that Jamie receives $2,000 cash and a car having a basis of $20,000 to the partnership and a fair market value of $30,000.
a. How much loss, if any, may Jamie recognize on the distribution?
b. What basis will Jamie take in the car?
c. Suppose Jamie’s 18-year-old son uses the car for his personal use for one year before Jamie sells it for $28,000. How much loss may Jamie recognize on the sale of the car? What tax planning procedures could have prevented this result?

  • CreatedSeptember 09, 2015
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