Last Year, Cara Contributed Investment Land with an FMV of $24,000

question 55

Essay

Last year, Cara contributed investment land with an FMV of $24,000 and basis of $18,000 to the CDE Partnership. CDE made no distributions during last year, and Cara's basis in her partnership interest on December 31 of last year was $28,000. On January 1 of this year, the partnership distributed cash of $30,000 to Cara and distributed the land contributed by Cara to another partner, David. On the distribution date, the land had a $27,000 FMV. Assume the CDE Partnership reported no profit or loss this year. How much gain (if any)must Cara recognize as a result of the distributions? What is her basis in the partnership after the distributions?

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Definitions:

Counteroffer

A response to an offer in a negotiation that modifies the original offer's terms, essentially creating a new offer.

Improperly Dispatched

Refers to items or messages that are sent out incorrectly or to the wrong destination.

Nonauthorized Communication

Nonauthorized communication involves the exchange of information without the required approval or consent from the relevant parties or authorities.

Silence Acceptance

The concept that silence can be interpreted as acceptance of an offer under certain conditions in contract law.