Scott Owns a 30% Interest in the Capital and Profits

question 59

True/False

Scott owns a 30% interest in the capital and profits of the SOS Partnership. Immediately before he receives a proportionate nonliquidating distribution from SOS, the basis of his partnership interest is $40,000. The distribution consists of $30,000 in cash and land with a fair market value of $80,000. SOS's adjusted basis in the land immediately before the distribution is $50,000. As a result of the distribution, Scott recognizes no gain or loss and his basis in the land is $10,000.

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Definitions:

Benzodiazepines

A class of psychoactive drugs used to treat conditions such as anxiety, insomnia, and seizures by enhancing the effect of the neurotransmitter GABA.

Tranquilizer

Drugs used to reduce tension or anxiety; they can vary in strength and effects, from mild sedatives to powerful antipsychotic medications.

Fluoxetine

An antidepressant medication in the selective serotonin reuptake inhibitor (SSRI) class, used to treat depression and other mental health conditions.

Xanax

A brand name for alprazolam, a prescription medication used to treat anxiety and panic disorders.