Problem 21-39 (LO 21-3) (Algo)

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Coy and Matt are equal partners in the Matcoy Partnership. Each partner has a basis in his partnership interest of $28,500 at the end of the current year, prior to any distribution. On December 31, each receives an operating distribution. Coy receives $10,300 cash. Matt receives $3,085 cash and a parcel of land with a $7,215 fair market value and a $4,100 basis to the partnership. Matcoy has no debt or hot assets.

Problem 21-39 Part a (Algo)

a. What is Coys recognized gain or loss? What is the character of any gain or loss?

b. What is Coys ending basis in his partnership interest?

c. What is Matts recognized gain or loss? What is the character of any gain or loss?

d. What is Matts basis in the distributed property?

e. What is Matts ending basis in his partnership interest?