Brian Is a 25percent Partner in the BC Partnership

question 17

Multiple Choice

Brian is a 25percent partner in the BC Partnership. On January 1, BC distributes $20,000 cash and land with a $16,000 fair value (inside basis $8,000) to Brian. BC has no liabilities at the date of the distribution. Brian's basis in his BC Partnership interest is $16,000. What is the amount and character of Brian's gain or loss on the distribution?

• A)$0.
• B)$4,000 capital gain.
• C)$12,000 capital gain.
• D)$20,000 capital gain.

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Definitions:

Babbage's Engine

Refers to Charles Babbage's Difference Engine and Analytical Engine, early mechanical computers designed in the 19th century.

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Electronic devices that control the flow of electrons through a vacuum, used in early radios, televisions, and computers before the advent of semiconductor devices.

Integrated Circuits

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Transistors

Semiconductor devices used to amplify or switch electronic signals and electrical power, fundamental components of modern electronic devices.