Andrew receives a proportionate nonliquidating distribution from the AEF Partnership. The distribution consists of $50,000 cash and property (adjusted basis to the partnership of $34,000 and fair market value of $42,000).Immediately before the distribution, Andrew's adjusted basis in the partnership interest was $40,000.His basis in the noncash property received is:
A)$0.
B)$34,000.
C)$42,000.
D)$50,000.
E)None of the above.

Question

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The Answer of Andrew receives a proportionate nonliquidating distribution from the AEF Partnership. The distribution consists of $50,000 cash and property (adjusted basis to the partnership of $34,000 and fair market value of $42,000).Immediately before the distribution, Andrew's adjusted basis in the partnership interest was $40,000.His basis in the noncash property received is:
A)$0.
B)$34,000.
C)$42,000.
D)$50,000.
E)None of the above.

Andrew Receives a Proportionate Nonliquidating Distribution from the AEF Partnership