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  3. david’s basis in the jimsoo partnership is $57,0

David’s basis in the Jimsoo Partnership is $57,000. In a proportionate liquidating distribution, David receives cash...

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Accounting

David’s basis in the Jimsoo Partnership is $57,000. In aproportionate liquidating distribution, David receives cash of$7,800 and two capital assets: (1) land 1 with a fair market valueof $21,600 and a basis to Jimsoo of $17,200, and (2) land 2 with afair market value of $10,600 and a basis to Jimsoo of $17,200.Jimsoo has no liabilities.

c1. If the two parcels of land had been inventory to Jimsoo,what are the tax consequences to David (amount and character ofgain or loss)?

c2. What is David's basis in distributed assets?

Answer & Explanation Solved by verified expert
4.1 Ratings (769 Votes)
Solution c2 David assigns a basis of Cash 7800 First parcel of land 17200 Second parcel of land 17200 42200 As the amount of 42200 of the bases is less than Davids basis in Jimsoo thus will be required    See Answer
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