Answered

Find the best solutions to your questions at Westonci.ca, the premier Q&A platform with a community of knowledgeable experts. Join our platform to connect with experts ready to provide detailed answers to your questions in various areas. Explore comprehensive solutions to your questions from knowledgeable professionals across various fields on our platform.

29. Randolph is a 30 percent partner in the RD Partnership. On January 1, RD distributes $22,500 cash and inventory with a fair value of $56,000 (inside basis of $28,000) to Randolph in complete liquidation of his interest. RD has no liabilities at the date of the distribution. Randolph's basis in his RD Partnership interest is $53,625. What is the amount and character of Randolph's gain or loss on the distribution

Sagot :

Answer: $3125 capital loss

Explanation:

Based on the information given in the question, we should note that RD Partnership distributes $22500 cash and inventory with inside basis of $28000.

Since Randolph's basis in his RD Partnership interest is $53,625, the amount and character of Randolph's gain or loss on the distribution will be:

= ($22500 + $28000) - $53625

= $50500 - $53625

= -$3125

Therefore, there's a capital loss of $3125

We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. We appreciate your time. Please revisit us for more reliable answers to any questions you may have. Westonci.ca is committed to providing accurate answers. Come back soon for more trustworthy information.