Question: Four GRRLs Partnership is owned by four friends Lacy holds

Four GRRLs Partnership is owned by four friends. Lacy holds a 40% interest; each of the others owns 20%. Lacy sells investment property to the partnership for its fair market value of $200,000. Her tax basis in the property was $250,000.
a. How much loss, if any, may Lacy recognize?
b. If Four GRRLs later sells the property for $260,000, how much gain must it recognize?
c. How would your answers in (a) and (b) change if Lacy owned a 60% interest in the partnership?
d. If Lacy's basis in the investment property was $120,000 instead of $250,000 and she was a 60% partner, how much, if any, gain would she recognize on the sale of the property to Four GRRLs? How is it characterized?

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  • CreatedMay 25, 2015
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