Rick Is a 30% Partner in the ROC Partnership

question 135

Multiple Choice

Rick is a 30% partner in the ROC Partnership.At the beginning of the tax year, Rick's basis in the partnership interest was $60,000, including his share of partnership liabilities.During the current year, ROC reported net ordinary income of $40,000.In addition, ROC distributed $5,000 to each of the partners ($15,000 total) .At the end of the year, Rick's share of partnership liabilities increased by $20,000.Rick's basis in the partnership interest at the end of the year is:

• A)$120,000.
• B)$87,000.
• C)$75,000.
• D)$60,000.
• E)None of the above.

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