Question: Danner Inc. has a $395,000 capital loss carryover that will expire at the end of the current tax year if it is not used. Also,

Danner Inc. has a $395,000 capital loss carryover that will expire at the end of the current tax year if it is not used. Also, Danner Inc. has been a general partner in the Talisman Partnership for three years and plans to end its involvement with the partnership by receiving a liquidating distribution. Initially, all parties agreed that Danner Inc.'s liquidating distribution would include $50,000 in cash and land with a fair market value of $400,000 (tax basis of $120,000). Immediately before the distribution, Danner's basis in its partnership interest is $150,000 which includes its $100,000 share of partnership debt. The Talisman Partnership does not hold any hot assets.
a. What is the amount and character of any gain or loss to Danner Inc.?
b. What is Danner Inc.'s basis in the land?
c. Can you suggest a course of action that would help Danner Inc. to avoid the expiration of its capital loss carryover?

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