When reconstructing a partners basis for prior years, without accounting for liabilities, when will a partners capital
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Question:
When reconstructing a partner’s basis for prior years, without accounting for liabilities, when will a partner’s capital account generally be the same as their outside basis on Schedule K-1, item L?
1. The capital account can never equal the outside basis.
2. The capital account will always equal the outside basis
3. When the partnership uses the book capital account method
4. When the partnership uses the tax capital account method.
Related Book For
Auditing and Assurance Services A Systematic Approach
ISBN: 978-0077732509
10th edition
Authors: William Messier Jr, Steven Glover, Douglas Prawitt
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