In a Proportionate Liquidating Distribution, RST Partnership Distributes to Partner

question 137

True/False

In a proportionate liquidating distribution, RST Partnership distributes to partner Riley cash of $30,000, accounts receivable (basis of $0, fair market value of $40,000), and land (basis of $65,000, fair market value of $50,000). Riley's basis was $40,000 before the distribution. On the liquidation, Riley recognizes a gain of $0, and her basis is
$10,000 in the land and $0 in the accounts receivable.

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Definitions:

Extended-Care Facility

A healthcare institution providing long-term patient care, including rehabilitation, nursing care, and chronic condition management.

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