Sharon Contributed Property to the Newly Formed QRST Partnership

question 31

Multiple Choice

Sharon contributed property to the newly formed QRST Partnership.The property had a $100,000 adjusted basis to Sharon and a $160,000 fair market value on the contribution date.The property was also encumbered by a $120,000 nonrecourse debt,which was transferred to the partnership on that date.Another partner,Rochelle,shares 30% of the partnership income,gain,loss,deduction,and credit.Under IRS regulations,Rochelle's share of the nonrecourse debt for basis purposes is:

• A)$20,000.
• B)$30,000.
• C)$36,000.
• D)$100,000.
• E)$120,000.

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Definitions:

Homeostasis

The ability or tendency of an organism or cell to maintain internal equilibrium by adjusting its physiological processes.

Thoracic Cavity

The part of the body located between the neck and the abdomen, housing the lungs and heart among other organs.

Esophagus

The muscular tube that conveys food from the mouth to the stomach.

Trachea

The windpipe, a vital part of the respiratory system that provides air passage from the larynx to the bronchi of the lungs.