If a Personal-Use Asset Is Contributed to a Partnership for Business

question 34

Multiple Choice

If a personal-use asset is contributed to a partnership for business use,the partnership's basis in the asset is always:

• A)$0.
• B)The FMV of the asset at the date of contribution.
• C)The basis of the asset at the date of contribution.
• D)The lesser of the asset's FMV or basis at the date of contribution.

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Definitions:

Disparity

A great difference or inequality between two or more things, often leading to an unfair situation.

Preoperational

The stage in Jean Piaget's theory of cognitive development where children (aged 2 to 7) begin to engage in symbolic play and struggle with logic and taking the perspective of others.

Cognitive Development

Cognitive Development is the process by which a child learns to reason, solve problems, and gain knowledge through interaction with the world around them, as described in theories such as those by Piaget.

Piaget's Stages

A theory of cognitive development devised by Jean Piaget, which describes how children's understanding of the world changes through four stages of development.