Four GRRLs Partnership is owned by four girlfriends. 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 (Lacy's basis is $250,000).
a. How much loss, if any, may Lacy recognize?
b. If the partnership 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 owned a 60% interest and her basis in the investment property was $120,000 (instead of $250,000), how much, if any, gain would she recognize on the sale? How would the gain be characterized?

  • CreatedSeptember 09, 2015
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