a) On January 1st of this year, Helen acquired a 1/4 interest in Treadwell LLC (a partnership). Helen contributed some land she held for investment. She purchased the land for $200,000, but the land increased in value and was worth $220,000 on the date of contribution. A few years later, Treadwell LLC sells the land for $320,000. At the beginning of that year, Helens capital account was $200,000.

1. Compute the gain or loss to Treadwell LLC when it sold the land_____________________

2. Compute the capital account for Helen immediately after the sale________________

b) Helens basis in Monarch is 30,000 at the beginning of the tax year, and she owns 20% of the business. During the year, Monarch had the following items:

Ordinary Income:

Tax-Free Interest Income:

Penalties and fines:

Loan 1 (from Helen to Monarch):

Loan 2 (from Greedy Bank to Monarch):

Compute the following:

If Monarch is a partnership, Helens partnership year______________________________

10,000 20,000 15,000 20,000 20,000

interest basis at the end of the

If Monarch is an S-Corp, Helens stock basis at the end of the year______________________________

If Monarch is an S-Corp, Helens loan basis at the end of the year _______