Questions from Federal Taxation

Q: Kim retires from the KLM Partnership on January 1 of the current

Kim retires from the KLM Partnership on January 1 of the current year. At that time, her basis in the partnership is $75,000, which includes her share of liabilities. The partnership reports the follo...

Q: When Jerry died on April 16 of the current year, he

When Jerry died on April 16 of the current year, he owned a 40% interest in the JM Partnership, and Michael owns the remaining 60% interest. All his assets are held in his estate for a two­...

Q: Bruce died on June 1 of the current year. On the

Bruce died on June 1 of the current year. On the date of his death, he held a one­third interest in the ABC Partnership, which had a $100,000 basis including his share of liabilities. Under...

Q: John has a 60% capital and profits interest in the JAS

John has a 60% capital and profits interest in the JAS Partnership with a basis of $333,600, which includes his share of liabilities, when he decides to retire. Andrew and Stephen want to continue the...

Q: Amy, a one­third partner, retires from the AJS

Amy, a one­third partner, retires from the AJS Partnership on January 1 of the current year. Her basis in her partnership interest is $120,000 including her share of liabilities. Amy receiv...

Q: Josh holds a general partnership interest in the JLK Partnership having a

Josh holds a general partnership interest in the JLK Partnership having a $40,000 basis and a $60,000 FMV. The JLK Partnership is a limited partnership that engages in real estate activities. Diana ha...

Q: Wendy, Xenia, and Yancy own 40%, 8%, and

Wendy, Xenia, and Yancy own 40%, 8%, and 52%, respectively, of the WXY Partnership. For each of the following independent situations occurring in the current year, determine whether the WXY Partnershi...

Q: Tyra has a zero basis in her partnership interest and a share

Tyra has a zero basis in her partnership interest and a share in partnership liabilities, which are quite large. Explain how these facts will affect the taxation of her departure from the partnership...

Q: For each of the following independent situations, determine which partnership(

For each of the following independent situations, determine which partnership(s) (if any) terminate and which partnership(s) (if any) continue. a. The KLMN Partnership is created when the KL Partners...

Q: Patty pays $100,000 cash for Stan’s one third interest

Patty pays $100,000 cash for Stan’s one third interest in the STU Partnership. The partnership has a Sec. 754 election in effect. Just before the sale of Stan’s int...