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Oliver Receives a Nonliquidating Distribution of Land Having a $25,000

question 39

Essay

Oliver receives a nonliquidating distribution of land having a $25,000 adjusted basis and a $32,000 FMV from the OK Partnership.At the time of the distribution,Oliver's basis in his partnership interest is $30,000.
a.What is the amount of recognized gain or loss on the distribution?
b.What is Oliver's basis in his partnership interest following the distribution?
c.What is Oliver's basis in the land?


Definitions:

BAT Model

A theoretical framework for analyzing the behavior, attitudes, and techniques necessary for effective leadership or managerial performance.

Optimal Cash Position

The Optimal Cash Position is the ideal amount of cash that a company aims to hold for covering immediate transactional needs while minimizing holding costs, ensuring liquidity without forgoing potential higher returns from other investments.

Cash Surpluses

Excess funds that a business possesses after it has paid all expenses and liabilities, which can be used for investment, paying down debt, or other purposes.

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The interval when funds are disbursed from a payer's account until the payee's bank credits the amount.

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