In the current year, the CAR Partnership received revenues of $400,000 and paid the following amounts: $160,000 in rent, utilities, and salaries; a $40,000 guaranteed payment to partner Ryan; $20,000 to partner Amy for consulting services; and a $40,000 distribution to 25% partner Cameron. In addition, the partnership realized a $12,000 net long- term capital gain. Cameron's basis in his partnership interest was $60,000 at the beginning of the year and included his $25,000 share of partnership liabilities. At the end of the year, his share of partnership liabilities was $15,000.
a. How much income must Cameron report for the tax year?
b. What is Cameron's basis in the partnership interest at the end of the year?

Question

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The Answer of In the current year, the CAR Partnership received revenues of $400,000 and paid the following amounts: $160,000 in rent, utilities, and salaries; a $40,000 guaranteed payment to partner Ryan; $20,000 to partner Amy for consulting services; and a $40,000 distribution to 25% partner Cameron. In addition, the partnership realized a $12,000 net long- term capital gain. Cameron's basis in his partnership interest was $60,000 at the beginning of the year and included his $25,000 share of partnership liabilities. At the end of the year, his share of partnership liabilities was $15,000.
a. How much income must Cameron report for the tax year?
b. What is Cameron's basis in the partnership interest at the end of the year?

In the Current Year, the CAR Partnership Received Revenues of $400,000