Doug,Geoffrey,and Fredrick form a partnership and contribute the following assets:
$\begin{array}{lrrrr}&FMV&\text { Basis }&\text { Partnership }\%\
\text { Doug's inventory } & \$ 45,000 & \$ 20,000 & 33.3 \% \
\text { Geoffrey's building. } & \$ 175,000& \$ 150,000 & 33.3 \% \
\text { Fredrick's acctrecv. } & \$ 50,00 \mathrm{C} & \$ 0 & 33.3 \%
\end{array}$ Geoffrey's building has a mortgage of $135,000 which the partnership assumes.
a.Do any of the partners recognize any gain? If so,how much and why?
b.What is each partner's basis in his or her partnership interest?
c.What is the basis to the partnership in each asset?
d.What are the holding periods to the partnership for each asset?
e.How would your answer change with respect to Geoffrey if his basis in the building was $85,000?

Question

Doug,Geoffrey,and Fredrick form a partnership and contribute the following assets:
 $\begin{array}{lrrrr}&FMV&\text { Basis }&\text { Partnership }\%\
\text { Doug's inventory } & \$ 45,000 & \$ 20,000 & 33.3 \% \
\text { Geoffrey's building. } & \$ 175,000& \$ 150,000 & 33.3 \% \
\text { Fredrick's acctrecv. } & \$ 50,00 \mathrm{C} & \$  0 & 33.3 \%
\end{array}$ Geoffrey's building has a mortgage of $135,000 which the partnership assumes.
a.Do any of the partners recognize any gain? If so,how much and why?
b.What is each partner's basis in his or her partnership interest?
c.What is the basis to the partnership in each asset?
d.What are the holding periods to the partnership for each asset?
e.How would your answer change with respect to Geoffrey if his basis in the building was $85,000?

Quizplus · Accepted Answer

The Answer of Doug,Geoffrey,and Fredrick form a partnership and contribute the following assets:
 $\begin{array}{lrrrr}&FMV&\text { Basis }&\text { Partnership }\%\
\text { Doug's inventory } & \$ 45,000 & \$ 20,000 & 33.3 \% \
\text { Geoffrey's building. } & \$ 175,000& \$ 150,000 & 33.3 \% \
\text { Fredrick's acctrecv. } & \$ 50,00 \mathrm{C} & \$  0 & 33.3 \%
\end{array}$ Geoffrey's building has a mortgage of $135,000 which the partnership assumes.
a.Do any of the partners recognize any gain? If so,how much and why?
b.What is each partner's basis in his or her partnership interest?
c.What is the basis to the partnership in each asset?
d.What are the holding periods to the partnership for each asset?
e.How would your answer change with respect to Geoffrey if his basis in the building was $85,000?

Doug,Geoffrey,and Fredrick Form a Partnership and Contribute the Following Assets