When Rachel's Basis in Her Interest in the RST Partnership

question 28

Essay

When Rachel's basis in her interest in the RST Partnership is $40,000, she receives a current distribution of office equipment. The equipment has an FMV of $60,000 and a basis of $50,000. Rachel will not use the office equipment in a business activity. What tax issues should Rachel consider with respect to the distribution?

---

Definitions:

Domestic Partner Benefits

Employee benefit policies that extend health insurance and other perks to domestic partners, akin to those traditionally reserved for spouses.

Case Management

A collaborative process of assessment, planning, facilitation, and advocacy for options and services to meet an individual's holistic needs through communication and available resources to promote quality cost-effective outcomes.

HMO

A Health Maintenance Organization, a type of health insurance plan that limits coverage to care from doctors who work for or contract with the HMO.

Medical History

A record of a person's past illnesses, surgeries, treatments, and health conditions, often used by healthcare providers for diagnosis and treatment planning.