The December 31, 2014, balance sheet of the BCD LLP reads as follows.
Each partner shares in 1/3 of the partnership capital, income, gain, loss, deduction, and credit. Capital is not a material income-producing factor to the partnership. On December 31, 2014, general partner Christina receives a distribution of $140,000 cash in liquidation of her partnership interest under § 736. Nothing is stated in the partnership agreement about goodwill. Christina's outside basis for the partnership interest immediately before the distribution is $84,000.
How much is Christina's recognized gain from the distribution and what is the character of the gain?

Question

The December 31, 2014, balance sheet of the BCD LLP reads as follows.
  Each partner shares in 1/3 of the partnership capital, income, gain, loss, deduction, and credit. Capital is not a material income-producing factor to the partnership. On December 31, 2014, general partner Christina receives a distribution of $140,000 cash in liquidation of her partnership interest under § 736. Nothing is stated in the partnership agreement about goodwill. Christina's outside basis for the partnership interest immediately before the distribution is $84,000.
How much is Christina's recognized gain from the distribution and what is the character of the gain?

Quizplus · Accepted Answer

The Answer of The December 31, 2014, balance sheet of the BCD LLP reads as follows.
  Each partner shares in 1/3 of the partnership capital, income, gain, loss, deduction, and credit. Capital is not a material income-producing factor to the partnership. On December 31, 2014, general partner Christina receives a distribution of $140,000 cash in liquidation of her partnership interest under § 736. Nothing is stated in the partnership agreement about goodwill. Christina's outside basis for the partnership interest immediately before the distribution is $84,000.
How much is Christina's recognized gain from the distribution and what is the character of the gain?

The December 31, 2014, Balance Sheet of the BCD LLP