Efosa is a partner in Far Away Partners, a general partnership. His adjusted bas

Question

Efosa is a partner in Far Away Partners, a general partnership. His adjusted basis in his partnership interest is $28,000. The partnership has no liabilities and no hot assets. Efosa received a liquidating distribution consisting of $10,000 cash, and two properties. Property 1 has an adjusted basis to the partnership of $16,000 and a fair market value of $20,000. Property 2 has an adjusted basis to the partnership of $8,000 and a fair market value of $15,000. What will be Efosa’s basis in Property 2?

a. $8,000

b. $15,000

c. $6,000

d. $18,000

e. None of the above

Explanation / Answer

C. 6000,

6000 is the efosa's basis in Property 2.

The basis of property (other than money) distributed to the partner by a partnership is its adjusted basis to the partnership immediately before the distribution.

Basis Rules to Liquidating Distributions

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