Alfred, a One-Third Profits and Capital Partner in Pizzeria Partnership

question 51

Essay

Alfred, a one-third profits and capital partner in Pizzeria Partnership, needs help in adjusting his tax basis to reflect the information contained in his most recent Schedule K-1 from the partnership. Unfortunately, the Schedule K-1 he recently received was for Year 3 of the partnership, but Alfred only knows that his tax basis at the beginning of Year 2 of the partnership was $23,000. Thankfully, Alfred still has his Schedule K-1 from the partnership for Years 1 and 2.
Using the following information from Alfred's Year 1, Year 2, and Year 3 Schedule K-1, calculate his tax basis the end of Year 2 and Year 3.

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Definitions:

Stinging Hair Cells

Specialized cells found in certain plants and animals used for defense or predation that deliver a sting or irritation when touched.

Portuguese Man-of-War

A marine cnidarian species known for its painful sting, characterized by its floating, gas-filled bladder and long tentacles.

Hydrozoans

Members of a class of predominantly marine animals in the phylum Cnidaria, which includes the Portuguese man-of-war, certain jellyfish, and hydra.

Ctenophores

A phylum of marine animals known as comb jellies, characterized by their gelatinous bodies and rows of ciliary plates for movement.