Carlos is a one-third general partner in the CTC Partnership. His adjusted tax basis in the...
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Carlos is a one-third general partner in the CTC Partnership. His adjusted tax basis in the partnership at the beginning of Year 3 is $50,000. The partnership had no debt at the beginning of the year. During the year, CTC borrowed $60,000 from a bank to purchase new equipment. The equipment was used as collateral for the loan. At the end of the year, the outstanding loan balance was $45,000 and the partnership accounts payable balance was $9,000. On December 31, Year 3, Carlos withdrew $30,000 cash from the partnership and received a distribution of land with a fair value of $75,000 and an adjusted basis to CTC of $55,000. The CTC Partnership reported the following items in Year 3: Item Amount Service revenue $582,500 Guaranteed payments to all partners ($50,000 each) 150,000 MACRS depreciation 11,000 Municipal bond interest 9,000 Operating expenses 85,500 Capital loss on investment stock (held long term) 117,000 Section 179 depreciation 90,000 Determine the effect of the items below on Carlos' ending tax basis, then calculate his tax and at-risk bases on December 31, Year 3. For each item, enter the applicable amount in the appropriate cell as a whole value. Use the minus sign to indicate a decrease in basis or negative value. If a response is zero, enter a zero (0). A B 1 Item Increase/decrease in basis 2 Carlos' share of partnership's ordinary net business income (loss) 123 3 Carlos' share of total separately stated items 123 123 4 Carlos' guaranteed payment Bank loan 123 6 Accounts payable 123 7 Distribution of land 123 8 Item Basis amount Carlos' ending tax basis 123 123 10 Carlos' ending at-risk basis Carlos is a one-third general partner in the CTC Partnership. His adjusted tax basis in the partnership at the beginning of Year 3 is $50,000. The partnership had no debt at the beginning of the year. During the year, CTC borrowed $60,000 from a bank to purchase new equipment. The equipment was used as collateral for the loan. At the end of the year, the outstanding loan balance was $45,000 and the partnership accounts payable balance was $9,000. On December 31, Year 3, Carlos withdrew $30,000 cash from the partnership and received a distribution of land with a fair value of $75,000 and an adjusted basis to CTC of $55,000. The CTC Partnership reported the following items in Year 3: Item Amount Service revenue $582,500 Guaranteed payments to all partners ($50,000 each) 150,000 MACRS depreciation 11,000 Municipal bond interest 9,000 Operating expenses 85,500 Capital loss on investment stock (held long term) 117,000 Section 179 depreciation 90,000 Determine the effect of the items below on Carlos' ending tax basis, then calculate his tax and at-risk bases on December 31, Year 3. For each item, enter the applicable amount in the appropriate cell as a whole value. Use the minus sign to indicate a decrease in basis or negative value. If a response is zero, enter a zero (0). A B 1 Item Increase/decrease in basis 2 Carlos' share of partnership's ordinary net business income (loss) 123 3 Carlos' share of total separately stated items 123 123 4 Carlos' guaranteed payment Bank loan 123 6 Accounts payable 123 7 Distribution of land 123 8 Item Basis amount Carlos' ending tax basis 123 123 10 Carlos' ending at-risk basis
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Adjustable tax basis 50000 Loan from the bank 60000 Outstanding loan balance at the end of the ... View the full answer
Related Book For
Data Analysis and Decision Making
ISBN: 978-0538476126
4th edition
Authors: Christian Albright, Wayne Winston, Christopher Zappe
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