Daniel's basis in the DAT Partnership is $135,000. DAT distributes its land to Daniel in complete liquidation of his partnership interest. DAT reports the following balance sheet just before the distribution:
If DAT has a §754 election in place, what is the amount and sign (positive or negative) of the special basis adjustment resulting from the distribution to Daniel? What is DAT's basis in its remaining assets?
Definitions:
Diaphragm
A muscular and membranous partition separating the abdominal and thoracic cavities and plays a major role in breathing.
Dead Space
Areas in the respiratory system that do not participate in gas exchange, including the nasal cavities, trachea, and bronchi.
Lung Compliance
Lung compliance refers to the ease with which the lungs can be expanded, determined by the elastic resistance of the lung tissue and chest wall to stretching during inhalation.
Inspiratory Reserve Volume
The additional amount of air that can be inhaled after a normal inhalation, contributing to lung capacity.
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