Adnan Had an Adjusted Basis of $11,000 for His Interest

question 95

Essay

Adnan had an adjusted basis of $11,000 for his interest in the Adnan and Donnell Partnership on December 31. On this date, Adnan received from the partnership, in complete liquidation of his interest, $10,000 cash and land with a $2,000 basis to the partnership and a $3,000 FMV. What is Adnan's basis for the land distributed to him?

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Definitions:

Agnosia

A neurological disorder marked by the inability to recognize and identify objects, people, sounds, or shapes, despite intact sensory faculties.

Neurogenesis

The process of forming new neurons in the brain, which occurs during prenatal development as well as in certain areas of the adult brain throughout a person's life.

Stem Cells

Undifferentiated cells that have the potential to develop into different cell types, used in medical research and treatment.

Differentiate

To recognize or ascertain what makes someone or something distinct or different compared to others.