On August 2, 2020, A, B & C form a general partnership (ABC) in which each...
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On August 2, 2020, A, B & C form a general partnership (ABC) in which each has the same interest in the partnership's capital and profits/losses. A and B each contribute $120,000 of cash in exchange for their partnership interest. C contributes $90,000 of cash. On October 31, 2020, the partnership purchases a Building for $1,000,000 by paying $250,000 cash and borrowing the balance on a nonrecourse basis. Immediately after the purchase of the Building -- a) What is the partnership's book capital account balance for the Building? b) What is the partnership's Inside basis in the Building? c) What is each partner's book capital account balance following the acquisition of the Building? d) What is each partner's Outside basis in their partnership interest following the partnership's acquisition of the Building? On August 2, 2020, A, B & C form a general partnership (ABC) in which each has the same interest in the partnership's capital and profits/losses. A and B each contribute $120,000 of cash in exchange for their partnership interest. C contributes $90,000 of cash. On October 31, 2020, the partnership purchases a Building for $1,000,000 by paying $250,000 cash and borrowing the balance on a nonrecourse basis. Immediately after the purchase of the Building -- a) What is the partnership's book capital account balance for the Building? b) What is the partnership's Inside basis in the Building? c) What is each partner's book capital account balance following the acquisition of the Building? d) What is each partner's Outside basis in their partnership interest following the partnership's acquisition of the Building?
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Answer rating: 100% (QA)
1 a The partnerships book capital account balance for the Building is equal to the total cost of the Building which is 1000000 b What is the partnerships Inside basis in the Building The inside basis ... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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