Al contributes land worth $30,000 to AB partnership in exchange for a 15% partnership interest. Als basis
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Al contributes land worth $30,000 to AB partnership in exchange for a 15% partnership interest. Al’s basis in the land is $50,000. Which of the following statements is correct regarding the contribution of the land?
a. Neither Al nor AB recognize a loss; Al’s basis in the partnership interest is $30,000
b. Al recognizes a $20,000 loss; Al’s basis in the partnership interest is $30,000
c. Neither Al nor AB recognize a loss; Al’s basis in the partnership interest is $50,000
d. Al recognizes a $20,000 loss; Al’s basis in the partnership interest is $50,000
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Related Book For 
Essentials Of Federal Income Taxation For Individuals And Business
ISBN: 9780808038009
15th Edition
Authors: Linda M. Johnson
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