When a partnership interest is sold,ordinary income may result if a partnership has unrealized receivables or inventory items.

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When a partnership interest is sold, the selling partner may face ordinary income if the partnership has unrealized receivables or inventory items. This is because the selling partner is considered to have sold their share of the partnership's assets, including any unrealized assets that would trigger ordinary income if they were sold by the partnership.

When a Partnership Interest Is Sold,ordinary Income May Result If