Jim's basis in his partnership is $200,000.His share of the 2013 income is $60,000.The partnership gave him a $75,000 distribution in 2013.What is his new basis in the partnership and what is his taxable income?

Question

Quizplus · Accepted Answer

Jim's new basis is calculated by adding his share of the income ($60,000) to his original basis ($200,000) and then subtracting the distribution ($75,000), resulting in $185,000. His taxable income is his share of the partnership income, which is $60,000.

Jim's Basis in His Partnership Is $200,000