Coles basis in his partnership interest was $10,000 at the beginning of the tax year. For the year, his share of the partnerships loss was $8,000, and he also received a distribution of $4,000. Which of the following statements is correct?

Group of answer choices

Cole has sufficient basis to deduct the $8,000 in full.

Cole must recognize a $2,000 gain.

Cole may deduct only $6,000 of the loss.

Coles basis in his partnership interest after considering the loss and distribution is $2,000.