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Rick has a $50,000 basis in the RKS General Partnership on January 1 of the...

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Accounting

Rick has a $50,000 basis in the RKS General Partnership on January 1 of the current year, and he owns no other investments. He has a 20% capital interest, a 30% profits interest, and a 40% loss interest in the partnership. Rick does not work in the partnership. The partnerships only liability is a $100,000 nonrecourse debt borrowed several years ago, which remains outstanding at year-end. Ricks share of the liability is based on his profits interest and is included in his $50,000 partnership basis. Rick and the partnership each report on a calendar year basis. Income for the entire partnership during the current year is:

Ordinary loss $440,000.00
Long-term capital gain $100,000.00
Sec. 1231 gain

$150,000.00

a) What is Rick's distributive share of income, gain, and loss for the current year?

b) What partnership incoem, gain, and loss should rick report on his tax return for the current year?

c) What is Rick's basis in his partnership interest on the first day of the next year

Rick's deductible loss is limited because of the at risk and passive loss limitations. (Information to be considered)

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