Partner Jordan received a distribution of $80,000 cash from the JKL Partnership in complete liquidation of his partnership interest. If Jordan's outside basis immediately before the distribution was $90,000, and if the partnership has made (and not revoked) a § 754 election in a prior year, which of the following statements is true? (Assume the partnership owns no "hot assets.")
A) The partnership will step-down the basis of its assets by $10,000.
B) The partnership will step-up the basis of its assets by $10,000.
C) Jordan will recognize $10,000 of ordinary loss on the distribution.
D) Jordan will recognize a $10,000 capital loss on the distribution.
E) Both a. and d. are true.

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The Answer of Partner Jordan received a distribution of $80,000 cash from the JKL Partnership in complete liquidation of his partnership interest. If Jordan's outside basis immediately before the distribution was $90,000, and if the partnership has made (and not revoked) a § 754 election in a prior year, which of the following statements is true? (Assume the partnership owns no "hot assets.")
A) The partnership will step-down the basis of its assets by $10,000.
B) The partnership will step-up the basis of its assets by $10,000.
C) Jordan will recognize $10,000 of ordinary loss on the distribution.
D) Jordan will recognize a $10,000 capital loss on the distribution.
E) Both a. and d. are true.

Partner Jordan Received a Distribution of $80,000 Cash from the JKL