When tax planning, remember that:

a$.$ Current and liquidating distributions may result in ordinary income recognition if hot assets are present.

b$.$ If a capital loss is desirable in a liquidating distribution, only cash can be distributed.

c$.$ If a capital loss is desirable in a liquidating distribution, the partnership should also contribute a capital asset.

d$.$ If gain recognition is undesirable, make sure the cash distributions from a partnership exceed the basis of the receiving partner's interest.

e$.$ Any debt assumption is not considered a cash distribution.