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:

Castration Anxiety

A concept in Freudian psychoanalysis that refers to a child's fear of losing his genitals, influencing the development of gender identity and roles.

Little Boys' Fears

A broad term that could refer to common anxieties or phobias experienced during childhood, particularly among young boys, such as fear of the dark, strangers, or separation from parents.

Forbidden Sexual

Typically refers to sexual behaviors or desires that are considered taboo or prohibited by societal norms, cultural traditions, or legal restrictions.

Sigmund Freud

Austrian neurologist and the founder of psychoanalysis, a method for treating psychopathology through dialogue between a patient and a psychoanalyst.