Identify Which of the Following Statements Is True

question 74

Multiple Choice

Identify which of the following statements is true.

• A)The contribution of Sec. 1245 property to a partnership triggers recognition of ordinary income by the contributor at the time of the transfer.
• B)A partner may not recognize ordinary income when receiving a capital and profits interest in a partnership in exchange for services.
• C)When a partnership interest is given to a partner in exchange for services, the partnership can deduct or capitalize the FMV of the services, depending on the nature of the services.
• D)All of the above are false.

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Definitions:

Enslaved Africans

Individuals from Africa who were forcefully transported to and held in captivity in the Americas to work as slaves, particularly from the 16th to the 19th centuries.

Social And Political Crises

Situations marked by severe instability, unrest, or conflict within a society or political system, often leading to significant change or upheaval.

English Colonies

These were territories around the world, including in North America, Africa, and Asia, that were under the control and governance of England before becoming independent nations.

Late Seventeenth Century

The closing decades of the 17th century, often referring to the period from 1660 to 1700, which was characterized by both turmoil and progress in various world regions.