A 70 percent partner has a $5,000 recognized loss when he sells equipment with a basis of $35,000 to the partnership at its FMV of $30,000.

Name: A 70 percent partner has a $5,000 recognized loss when he sells equipment with a basis of $35,000 to the partnership at its FMV of $30,000.
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The recognized loss would be disallowed because losses on transactions between a partnership and a partner are not recognized when the partner owns more than 50% of the partnership interests.

A 70 Percent Partner Has a $5,000 Recognized Loss When