Loss Cannot Be Recognized on a Current (Nonliquidating) Distribution from a Partnership

question 192

True/False

Loss cannot be recognized on a current (nonliquidating) distribution from a partnership unless cash, unrealized receivables, and/or § 1231 assets are the only items distributed.

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Definitions:

Complaint

A formal statement initiating a lawsuit, alleging facts and legal reasons for action against the defendant.

Clerk

An administrative or office worker, often responsible for handling paperwork or performing general office duties.

Summons

a legal document issued by a court or administrative agency requiring the recipient to appear in court or respond to a legal proceeding.

Arbitration

A method of resolving disputes outside the courts, where the parties present their case to a neutral third-party arbitrator who makes a binding decision.