Questions from Federal Taxation

Q: Wylie receives cash of $145,000 in liquidation of his

Wylie receives cash of $145,000 in liquidation of his partnership interest, in which he has a basis of $110,000. The partnership owns no hot assets and continues in existence. After following all of t...

Q: The Whitewater LLP is equally owned by three partners and shows the

The Whitewater LLP is equally owned by three partners and shows the following balance sheet at the end of the current tax year. Partner Petula is an active (i.e., "general") partner retiring from th...

Q: By the end of 2017, Klein, a domestic corporation,

By the end of 2017, Klein, a domestic corporation, had accumulated $10 million in cash from the overseas operations of its Liberia subsidiary. Klein made no distributions of these accumulated funds du...

Q: Corn ell purchased a 15-year, $25,000

Corn ell purchased a 15-year, $25,000 bond from Fulvous Corporation for $20,000 eight years ago. Interest of $2,300 has been amortized over the eight years and added to Cornell's bond basis. In the cu...

Q: On December 31, Yong sells his 100/o interest in

On December 31, Yong sells his 100/o interest in Catatvissa LLC to Mei for $17,500. Yong is a calendar year taxpayer. Catawissa owns no hot assets, and its tax year ends on September 30. On October 1,...

Q: The Lexington Partnership has a depreciable business asset (personal property)

The Lexington Partnership has a depreciable business asset (personal property) that it originally purchased for $60,000. The asset now has an adjusted basis of $36,000 and a market value of $70,000. T...

Q: Dusan is a member of the Tonda LLC, and all members

Dusan is a member of the Tonda LLC, and all members have equal interests in capital and profits. The LLC has made an optional adjustment-to-basis election. Dusan's interest is sold to Adele for $35,00...

Q: Berdine has a basis of $32,000 in her partnership

Berdine has a basis of $32,000 in her partnership interest and receives land with an adjusted basis to the partnership of $78,000 in termination of her interest. (The partnership holds no hot assets.)...

Q: A partnership in which a parent transferred a 40% interest by

A partnership in which a parent transferred a 40% interest by gift to a child generated a profit of $130,000. Capital is a material income-producing factor. The parent performed services valued at $44...

Q: Clifton Corporation acquired all of the outstanding Gillion stock on January 1

Clifton Corporation acquired all of the outstanding Gillion stock on January 1, year 1, for $2,400,000. The parties immediately elected to file consolidated Federal income tax returns. Gillion reporte...