Doug Purchases a 20% Interest in the Quix Partnership for $10,000

question 16

Essay

Doug purchases a 20% interest in the Quix Partnership for $10,000 on January 1, 2019, and begins to materially participate in the partnership's business. The Quix Partnership uses the calendar year as its tax year. At the time of the purchase, the Quix Partnership has $4,000 in liabilities, and Doug's share is 20%. What is Doug's basis in his partnership interest on January 1, 2010?

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Definitions:

Elevated Urea

This refers to an increase in the concentration of urea in the blood, often indicative of kidney dysfunction or dehydration.

Creatinine

A chemical waste molecule that is generated from muscle metabolism and is excreted in the urine; its level is a measure of kidney function.

Vascular Surgeon

A specialized doctor who diagnoses, treats, and manages conditions of the vascular system, excluding the heart and brain.

Fistula

An abnormal tubelike passage from a normal cavity or an abscess to a free surface.