The total bases of all distributed property in the partner's hands following a nonliquidating distribution is limited to
A)the partner's predistribution basis in his partnership interest.
B)the FMV of the property distributed.
C)the partnership's bases in the distributed property.
D)the predistribution FMV of the partner's partnership interest.

Question

Quizplus · Accepted Answer

The total bases of all distributed property in the partner's hands following a nonliquidating distribution is limited to the partner's predistribution basis in his partnership interest. This means that the partner cannot have a higher basis in the property received than their basis in their partnership interest before the distribution.

The Total Bases of All Distributed Property in the Partner's