Example $4--$ Proportionate Liquidating Distributions

In each of the following independent liquidating distributions in which the partnership also liquidates, determine the amount and character of any gain or loss to be recognized by each partner and the basis of each asset received. In each case, assume the distribution of hot assets are proportionate to the partners.

a$.$ Roxanne has a partnership basis of $$23,000$ and receives a distribution of $$40,000$ in cash.

b$.$ Barry has a partnership basis of $$30,000$ and receives $$12,000$ cash and a capital asset with a basis to the partnership of $$23,000$ and a fair market value of $$16,000.$

c$.$ Jason has a partnership basis of $$20,000$ and receives $$7,000$ cash, inventory with a basis to the partnership of $$8,000,$ and two capital assets with a partnership basis of $$6,000$ each. The inventory has a fair market value of $$9,000.$ Capital asset one has a fair market value of $$8,000$ and capital asset two has a fair market value of $$2,000.$

d$.$ Marie has a partnership basis of $$25,000$ and receives a distribution of $$10,000$ cash and an account receivable with a basis of $$0$ to the partnership $($value is $$3,000).$

e$.$ Julie$$s basis in her partnership interest is $$108,000.$ In a proportionate distribution in liquidation of the partnership, Julie receives $$50,000$ cash and two parcels of land $($investment property$)$ with bases of $$20,000$ each to the partnership. The fair market values of the parcels are $$10,000$ and $$30,000.$

f$.$ How would your answer to part e$.$ change if the parcels of land were held by the partnership as inventory?