Susan Contributed Land with a Basis of $6,000 and an FMV

question 17

Multiple Choice

Susan contributed land with a basis of $6,000 and an FMV of $10,000 to the SH Partnership two years ago to acquire her partnership interest. This year, the land is distributed to Harry when its FMV is $11,000. No other distributions have been made since Susan became a partner. When the land is distributed, the partnership's basis in the land immediately before distribution is increased by

• A)$0.
• B)$1,000.
• C)$4,000.
• D)$5,000.

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Definitions:

Nurture

The processes external to an organism that nourish it as it develops according to its genetic code or that cause it to swerve from its genetically programmed course. Environmental factors that influence development.

Genes

Fundamental units of heredity that are responsible for guiding the process of creating proteins that, in turn, play critical roles in body functions and development.

Infancy

The period in a child's life from birth to 12 months, a time of rapid growth and development.

Childhood

The period of life from birth to adolescence, characterized by growth, learning, and play.