Scott Is a 50% Partner in the LS Partnership

question 12

Essay

Scott is a 50% partner in the LS Partnership. Scott has a basis in his partnership interest of $84,000 at the end of the current year, prior to any distribution. On December 31, Scott receives an operating distribution of $9,000 cash and a parcel of land with a $21,000 fair market value and a $12,000 basis to the partnership. LS has no debt or hot assets. What is the amount and character of Scott's recognized gain or loss? What is Scott's basis in the distributed property? What is Scott's ending basis in his partnership interest?

---

Definitions:

Cationic Polymerization

A type of polymerization where a cationic initiator transfers charge to a monomer causing it to become reactive and link to other monomers.

Poly(acrylonitrile)

A synthetic polymer made by polymerizing acrylonitrile, used in the production of fibers, plastics, and rubbers due to its strength and thermal stability.

Poly (vinyl Acetate)

A polymer made by polymerizing vinyl acetate, used in adhesives, paints, and various coatings.

Repeating Units

Sequential segments of the same structure in a polymer, which repeat numerous times to form the polymer chain.