Generally, no gain is recognized on a proportionate liquidating or current nonliquidating) distribution of noncash property, even if the fair market value of property distributed exceeds the partner's basis in the partnership interest.

Question

Quizplus · Accepted Answer

In a proportionate distribution, the partner's basis in the partnership interest is adjusted, and no gain is recognized even if the fair market value of the distributed property exceeds the partner's basis.

Generally, No Gain Is Recognized on a Proportionate Liquidating or Current