Aissa has just become a partner of the Gratitude Partnership She has some vacant land that is in a perfect location for a building the partnership wants to construct As her initial capital contribution, she transfers the land to the partnership The land cost her $45,000 and has a fair market value of $95,000 No consideration is received from the partnership What are the tax consequences of this transaction Aissa will have disposed of the land for its original cost of $45,000 The adjusted cost base of her partnership interest will be $45,000 The partnership will have acquired the land for $45,000 Aissa will have disposed of the land for $95,000 resulting in a taxable capital gain of $25,000 The adjusted cost base of her partnership interest will be $95,000 The partnership will have acquired the land for $95,000 Aissa will have disposed of the land for $95,000 resulting in a taxable capital gain of $25,000 The adjusted cost base of her partnership interest will be $70,000 The partnership will have acquired the land for $70,000 Aissa will have disposed of the land for $45,000 The adjusted cost base of her partnership interest will be $95,000 The partnership will be considered to have acquired the land for $95,000

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Posted on Sep 02, 2024

Aissa has just become a partner of the Gratitude Partnership. She has some vacant land that is in a perfect location for a building the

Aissa has just become a partner of the Gratitude Partnership. She has some vacant land that is in a perfect location for a building the partnership wants to construct. As her initial capital contribution, she transfers the land to the partnership. The land cost her $45,000 and has a fair market value of $95,000. No consideration is received from the partnership. What are the tax consequences of this transaction?

		Aissa will have disposed of the land for its original cost of $45,000.The adjusted cost base of her partnership interest will be $45,000. The partnership will have acquired the land for $45,000.
		Aissa will have disposed of the land for $95,000 resulting in a taxable capital gain of $25,000. The adjusted cost base of her partnership interest will be $95,000. The partnership will have acquired the land for $95,000.
		Aissa will have disposed of the land for $95,000 resulting in a taxable capital gain of $25,000. The adjusted cost base of her partnership interest will be $70,000. The partnership will have acquired the land for $70,000.
		Aissa will have disposed of the land for $45,000. The adjusted cost base of her partnership interest will be $95,000. The partnership will be considered to have acquired the land for $95,000.