At the Beginning of the Year, Joe's Basis in His

question 31

Multiple Choice

At the beginning of the year, Joe's basis in his partnership interest was $5,000. During the year, Joe contributed $10,000 in cash to the partnership and signed a bank loan to be personally liable for the partnership's debt of $25,000. For the current year, the partnership allocated a loss of $60,000 to Joe. In the following year, Joe's portion of the partnership income is $30,000. Which of the following is accurate?

• A)In the following year, Joe's reportable taxable income from the partnership is $10,000.
• B)Joe's basis in his partnership at the end of the year is $15,000.
• C)Joe may deduct all of the $60,000 loss in the current year.
• D)Joe may carry over a $45,000 loss to the following year.

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