When property is contributed to a partnership in exchange for a capital and profits interest, when does the partner's
Holding period begin for the partnership interest?
A) The day after the contribution date.
B) The day the property was contributed.
C) The day the contributed property was purchased.
D) The day the partnership interest was acquired.
E) Either (or both) c. and d. may be true, depending upon the types of property contributed.

Question

Quizplus · Accepted Answer

The holding period for a partnership interest begins on the day the contributed property was purchased if it is a capital asset or Section 1231 property. For other types of property, it begins on the day the partnership interest was acquired.

When Property Is Contributed to a Partnership in Exchange for a Capital