Joe is a member of a 5-person partnership, which provides disc jockeys for various social events. Joe has a $25,000 outside basis in his partnership income. The partnership has the following assets:. $100,000 cash. Good will, $50,000 value, 0 basis. Inventory, $50,000 value, $20,000 basis. Joe has a $25,000 basis in his partnership interest. The partnership liquidates Joe’s interest, paying him $50,000. Discuss the tax treatment to Joe and the four other partners, indicating what additional information, if any, you would want to know.

Answer rating: 100% (QA)

When Joe is paid 50000 for his partnership interest he will recognize 25000 of longterm capital gain ... View the full answer