Barry receives a liquidating distribution of $$90,000$ cash.

The remaining partners assume Barry$$s share of the

partnership liabilities. How much gain or loss must Barry

recognize? How is the gain or loss characterized?

Basis FMV Basis FMV

Cash $120,000120,000$ Note payable $30,00030,000$

A$/$R $090,000$ Barry, Capital $40,00085,000$

Capital assets $30,00075,000$ David, Capital $40,00085,000$

Dale, Capital $40,00085,000$

Total $150,000285,000$ Total $150,000285,000$