Albert contributes a Sec. 1231 asset to a partnership on June 1 of this year in exchange for a 10% partnership interest. He had purchased the asset on March 1, 2002. His holding period for the partnership interest begins
A)March 1, 2002.
B)March 2, 2002.
C)June 1 of the current year.
D)June 2 of the current year.

Question

Quizplus · Accepted Answer

The holding period for a partnership interest received in exchange for a capital asset (like a Sec. 1231 asset) includes the holding period of the asset contributed. Therefore, Albert's holding period for the partnership interest begins on the same date he originally acquired the asset, which is March 1, 2002.

Albert Contributes a Sec