Essay
The December 31,2010,balance sheet of the BCD General Partnership reads as follows.
Each partner shares in 1/3 of the partnership capital,income,gain,loss,deduction and credit.Capital is not a material income-producing factor to the partnership.On December 31,2010,general partner Cassie receives a distribution of $120,000 cash in liquidation of her partnership interest under § 736.Nothing is stated in the partnership agreement about goodwill.Cassie's outside basis for the partnership interest immediately before the distribution is $74,000.
How much is Cassie's recognized gain from the distribution and what is the character of the gain?
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Cassie will recognize $39,000 of ordinar...View Answer
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