Heidi and Teresa Are Equal Partners in the HT Partnership

question 92

Essay

Heidi and Teresa are equal partners in the HT Partnership. The partners formed the partnership seven years ago by contributing cash. Prior to any distributions, the partners each have a $50,000 basis in their partnership interests. On December 31, the partnership makes a pro rata operating distribution to Heidi of $60,000 cash. What is the amount and character of Heidi's recognized gain or loss? What is Heidi's remaining basis in HT?

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Definitions:

Time-Outs

A disciplinary technique used to remove a child from an environment where inappropriate behavior has occurred, to encourage reflection and calm down.

Successive Approximations

A method used in conditioning and learning in which behaviors are broken down into simpler steps and rewarded progressively as they become closer to the desired behavior.

Shaping

A method used in behavioral psychology to gradually teach new behaviors through the use of reinforcement for successive approximations to the desired behavior.

Discriminative Stimulus

A specific cue or stimulus in the environment that signals the availability of reinforcement or punishment, guiding behavior accordingly.