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Your Client, Greg, Transferred Precontribution Gain Property to BIG LLC

question 65

Essay

Your client, Greg, transferred precontribution gain property to BIG LLC on December 31, 2014, for a 30% interest.
a. Describe two types of distributions that might result in some or all of this precontribution gain being recognized by Greg.
b. In general terms, what is the purpose of these rules?


Definitions:

Computers

Electronic devices that execute commands from software to perform a wide range of functions, from basic calculations to complex data processing.

Ordinary Care

The level of care that a reasonably prudent person would exercise in similar circumstances; a standard for negligence determination.

Reasonable Care

The degree of caution and concern an ordinarily prudent person would use in similar circumstances, often used as a standard for determining negligence.

Good Faith

An honest intention to act without taking an unfair advantage over another party.

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