Charlie Receives a Proportionate, Nonliquidating Distribution from the Forest Partnership

Multiple Choice

Charlie receives a proportionate, nonliquidating distribution from the Forest Partnership.The distribution consists of $20,000 cash and property with an adjusted basis to the partnership of $40,000 and a fair market value of $68,000.Immediately before the distribution, Charlie's adjusted basis for her partnership interest is $85,000.Charlie's basis in the noncash property received is:

A) $20,000.
B) $40,000.
C) $65,000.
D) $68,000.
E) None of the above.