Assume the same facts as in problem 52, except that rather than sell his partnership interest to Susan, Woody receives a $ 47 , 000 $ 47 , 000 cash distribution from the partnership in complete liquidation of his interest How would the tax consequences for Woody differ from those associated with th...

Lets analyze the tax consequences for Woody in the scenario where he receives a cash distribution from the partnership in complete liquidation of his ...

Assume the same facts as in problem 52, except that rather than sell his partnership interest to

Question:

Assume the same facts as in problem 52, except that rather than sell his partnership interest to Susan, Woody receives a $$ 47, 000$ cash distribution from the partnership in complete liquidation of his interest. How would the tax consequences for Woody differ from those associated with the sale to Susan?

Problem 52,

Woody is a one-third partner in Boyd Partners. His basis in his partnership interest is $$ 28, 000$ , consisting of his $$ 15, 000$ capital interest and his $$ 13, 000$ (one-third) share of partnership liabilities. He is considering selling his interest to Susan. Susan would pay Woody $$ 47, 000$ cash and step into his shoes as a partner. The partnership has no hot assets.