Which of the Following Statements Regarding the Sale of a Partnership

question 98

Multiple Choice

Which of the following statements regarding the sale of a partnership interest is False?

• A) The seller's primary tax concern in a partnership interest sale is calculating the amount and character of gain or loss on the sale.
• B) The selling partner determines the gain or loss as the difference between the amount realized and her outside basis in the partnership.
• C) Hot assets change the character of a gain on the sale from ordinary income to capital gain.
• D) Any debt relief increases the amount the partner realizes from the sale.