Eric Receives a Proportionate Nonliquidating Distribution When the Basis of His

question 31

Multiple Choice

Eric receives a proportionate nonliquidating distribution when the basis of his partnership interest is $80,000. The distribution consists of $20,000 in cash and property with an adjusted basis to the partnership of $45,000 and a fair market value of $40,000. Eric's basis in the noncash property and his remaining basis in the partnership interest are:

• A) $45,000; $35,000.
• B) $45,000; $15,000.
• C) $40,000; $40,000.
• D) $40,000; $20,000.
• E) None of the above.

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Definitions:

Syntax

The set of rules, principles, and processes that govern the structure of sentences in a given language, especially the order of words and phrases.

Semantics

Semantics is the branch of linguistics concerned with the meaning of words, phrases, and sentences in language.

Flynn Effect

The observed substantial and long-term increase in intelligence test scores measured in various parts of the world over the 20th century.

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Numeric assessments derived from intelligence tests that aim to quantify a person's intellectual abilities compared to a statistical norm.