Maria purchased an interest in a real estate tax shelter many years ago and deducted losses from

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Maria purchased an interest in a real estate tax shelter many years ago and deducted losses from its operation for several years. The real property owned by the tax shelter when Maria made her investment has been fully depreciated on a straight-line basis. Her basis in her limited partnership interest is zero, but her share of partnership liabilities is $100,000. Explain the tax results if Maria sells her partnership interest for $5 cash.
Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...
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Federal Taxation 2016 Comprehensive

ISBN: 9780134104379

29th Edition

Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson

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