Alex and Betty own AB Partnership. The Book and Tax balance sheet are below. Chuck has contributed
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Alex and Betty own AB Partnership. The Book and Tax balance sheet are below. Chuck has contributed services to the partnership for a 20% interest in the partnership. The partner ratios are below after the admittance of Chuck. | |||||||
Calculate the Income to Chuck and the deductions to the partners. | |||||||
Prepare a new Tax and Book Balance sheet after the admittance of Chuck | |||||||
Alex | Betty | Chuck | |||||
Profit | 40% | 40% | 20% | ||||
Loss | 40% | 40% | 20% | ||||
Capital | 40% | 40% | 20% | ||||
Tax Basis | Book - FMV | ||||||
Cash | 300,000 | 300,000 | |||||
Building - Alex | 375,000 | 440,000 | |||||
Building - Betty | 410,000 | 525,000 | |||||
Land | 130,000 | 150,000 | |||||
Assets | 1,215,000 | 1,415,000 | |||||
Recourse Liability | 500,000 | 500,000 | |||||
Capital | |||||||
Alex | 315,000 | 457,500 | |||||
Betty | 400,000 | 457,500 | |||||
Liab & Capital | 1,215,000 | 1,415,000 |
Alex and Betty own AB Partnership. The Book and Tax balance sheet are below. Chuck has contributed services to the partnership for a 20% interest in the partnership. The partner ratios are below after the admittance of Chuck. | |||||||
Calculate the Income to Chuck and the deductions to the partners. | |||||||
Prepare a new Tax and Book Balance sheet after the admittance of Chuck | |||||||
Alex | Betty | Chuck | |||||
Profit | 40% | 40% | 20% | ||||
Loss | 40% | 40% | 20% | ||||
Capital | 40% | 40% | 20% | ||||
Tax Basis | Book - FMV | ||||||
Cash | 300,000 | 300,000 | |||||
Building - Alex | 375,000 | 440,000 | |||||
Building - Betty | 410,000 | 525,000 | |||||
Land | 130,000 | 150,000 | |||||
Assets | 1,215,000 | 1,415,000 | |||||
Recourse Liability | 500,000 | 500,000 | |||||
Capital | |||||||
Alex | 315,000 | 457,500 | |||||
Betty | 400,000 | 457,500 | |||||
Liab & Capital | 1,215,000 | 1,415,000 |
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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