John Has a Basis in His Partnership Interest of $30,000

question 85

Multiple Choice

John has a basis in his partnership interest of $30,000. He receives a current distribution of $6,000 cash, unrealized receivables (FMV $11,000, basis $10,000) , inventory (FMV $8,000, basis $4,000) , and investment land (FMV $7,000, basis $6,000) . The partners' relative interest in the Sec. 751 assets do not change as a result of the current distribution. His basis in the land is

• A)$5,000.
• B)$6,000.
• C)$7,000.
• D)$10,000.

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Definitions:

Courts

Institutions that administer justice through the interpretation and application of laws.

Fraudulent Misrepresentation

The act of deliberately providing false information or deceiving another party, leading to harm or loss.

Odometer

An odometer is a device used to measure the distance traveled by a vehicle, typically recorded in miles or kilometers.

Duress

Duress involves compelling someone to act against their will by using threats, force, or coercion in the context of making a contract.