Fei and Wei formed the FW Ltd. general partnership. Fei contributed a building and land with a FMV of $130,000 (building $100,000 and land $30,000), nonrecourse debt of $60,000, and a tax basis of $75,000 (building $60,000 and land $15,000). Wei contributed cash of $30,000 for his 30% share of the partnership. The building has 10 years remaining in its class life. The book depreciation is $10,000 per year and the tax depreciation is $6,000 per year. 

Calculate each partner's book and tax depreciation using the traditional method found in Regulation 1.704-3(b) for 2022.

Answer rating: 100% (QA)

To calculate each partners book and tax depreciation using the traditional method for 2022 we need to allocate the depreciation based on their respect... View the full answer