On December 31 of the current year, after receipt of his share of partnership income, Fox sold his interest in a limited partnership for $50,000 cash plus relief of all liabilities. On that date, the adjusted basis of Fox’s partnership interest was $60,000, consisting of his capital account of $35,000 and his share of the partnership liabilities of $25,000. The partnership has no unrealized receivables or substantially appreciated inventory. What is Fox’s gain or loss on the sale of his partnership interest?
a. Ordinary loss of $10,000
b. Ordinary gain of $15,000
c. Capital loss of $10,000
d. Capital gain of $15,000