Gus is the general partner and Laura is the limited partner of GL Limited Partnership. Gus contributes $500,000 cash and Laura contributes a building with a fair market value of $600,000 (adjusted basis of $125,000) to the partnership.Gus and Laura share equally in partnership profits and losses.In 2008,the first year in business,GL obtains nonrecourse financing of $200,000 to cover operating expenses and incurs a $1,200,000 loss.How much loss may be passed through to Gus and Laura?
A) $600,000 to Gus, $225,000 to Laura.
B) $500,000 to Gus, $600,000 to Laura.
C) $500,000 to Gus, $125,000 to Laura.
D) $700,000 to Gus, $125,000 to Laura.
E) None of the above.
Correct Answer:
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