1. Which of the following do not decrease a partner's basis in the partnership interest?

a. A decrease in the partner's share of partnership liabilities.

b. A distribution made by the partnership to the partner.

c. The partner's distributive share of nondeductible items that are not capital in nature.

d. The partner's distributive share of partnership losses. e. All of the above decrease a partner's basis in the partnership interest.

2. The partnership of A and B realized an ordinary loss of $75,000 in 2017. Both the partnership and the two partners are on a calendar year basis. The partners share profits and losses equally. On December 31, 2017, adjusted basis of partnership interest for A and B are $36,000 and 39,000 respectively. On his individual return for 2017, what amount and character of loss should B deduct and what will be Bs basis after loss deduction?

a. Capital loss of $37,500 and Basis of $1,500

b. An ordinary loss of 39,000 and Basis of $0

c. An ordinary loss of $37,500 and Basis of $1,500

d. A capital loss of $39,000 and Basis of $0