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The Taurin Partnership (a calendar-year-end entity) has the following assets as of December 31 of
the current year:
On December 31, Taurin distributes $15,800 of cash, $10,533 (FMV) of accounts receivable, and
$41,400 (FMV) of inventory to Emma (a one-third partner) in termination of her partnership
interest. Emma's basis in her partnership interest immediately prior to the distribution is $41,767.
Required:
c1. If Emma's basis before the distribution was $57,517 rather than $41,767, what is Emma's
recognized gain or loss?
c2. What is her basis in the distributed assets?
Tax Basis FMV
Cash $ 47,400 $ 47,400
Accounts receivable 15,800 31,600
Inventory 84,000 124,200
Totals $ 147,200 $ 203,200

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The Taurin Partnership a calendaryearend entity has the .pdf

  • 1. The Taurin Partnership (a calendar-year-end entity) has the following assets as of December 31 of the current year: On December 31, Taurin distributes $15,800 of cash, $10,533 (FMV) of accounts receivable, and $41,400 (FMV) of inventory to Emma (a one-third partner) in termination of her partnership interest. Emma's basis in her partnership interest immediately prior to the distribution is $41,767. Required: c1. If Emma's basis before the distribution was $57,517 rather than $41,767, what is Emma's recognized gain or loss? c2. What is her basis in the distributed assets? Tax Basis FMV Cash $ 47,400 $ 47,400 Accounts receivable 15,800 31,600 Inventory 84,000 124,200 Totals $ 147,200 $ 203,200