The IRS is auditing our client, Taylor Drift, regarding the tax treatment of the disposition of her interest in TK Partnership. Here$$s the background:

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Partner Taylor received $$120,000$ of cash from TK Partnership on August $1,2024,$ to retire her entire interest in TK $($which continues to operate$).$ TK is a consulting services partnership, and Taylor was a general partner. The TK General Partnership agreement, drafted in $2018,$ did not specify how a retiring partner would be compensated for their share of partnership goodwill. In $2023,$ TK Partnership executed an $$Amendment of General Partnership Agreement,$$ which stipulated that Taylor was to receive $$120,000$ cash on August $1,2024,$ to retire her interest in the partnership. The amendment further stated that $$40,000$ of this amount was for Taylor$$s one$-$fourth interest in the fair market value of the partnership$$s net assets, while the remaining $$80,000$ was characterized as a guaranteed payment or compensation for goodwill.

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The IRS argues that the $$Amendment of General Partnership Agreement$$ is ambiguous and intends to classify the payment for goodwill as ordinary income to Taylor, thus allowing a deduction for TK Partnership. $($This treatment would maximize the government$$s tax revenue.$)$ Your manager remembers that there was a Tax Court case some years ago regarding partnership agreements and goodwill. I believe the case may be something like "Johnson" or "Jensen." $$Please use Checkpoint to research this issue and copy the links to the areas used in RIA Checkpoint $($directly$)$ on a separate page $($in addition to your primary sources specifically referenced$).$ You will receive ZERO credit for this assignment if you do not copy hyperlinks to the resources used in RIA Checkpoint.$$

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Please find the case that helps Taylor argue that the portion of the payment related to goodwill should be treated as a return of basis and taxed as capital gain rather than ordinary income? Please summarize the holding in that case and specifically discuss the holding as it relates to the following areas:

$1.$ Partnership Agreements and Goodwill

$2.$ Return of Basis and Capital Gain Treatment

$3.$ The overall conclusion based on the case.