Business Entity

The following facts apply for questions #14 through #17: Partnership XYZ distributes Asset #1 to Partner X as an operating distribution. Asset #1 has an inside basis in Partnership XYZ of $15,000 and a fair market value of S30,000 Immediately before the distribution, Partner X has an outside basis of $10,000 in its partnership interest in Partnership XYZ; and Partner X's capital account in Partnership XYZ equals $40,000. Partnership XYZ held Asset #1 as a capital asset for 2 years before that asset's distribution to Partner X. 14. What holding period will Partner X have in Asset #1? a. Brand new b. year c. Tacked 15. What basis does Partner X have in Asset #1 after receiving that asset? a. S10,000 b. $15,000 c. $30,000 d. $40,000 16. After receiving Asset #1, Partner X will have an outside basis in its partnership interest in Partnership XYZ equal to: a. SO b. $10,000 c. S15,000 d. $40,000 17. What will Partner X's capital account equal after its receipt of Asset # 1 ? a. S0 b. $10,000 c. S15,000 d. $40,000