Enrique is an attorney who agrees to perform legal services to the FGH partnership. In return Enrique receives a 3% profit and loss interest and a capital account of zero. There are no liabilities in the partnership.

1) Does Enrique recognize income as a result of the receipt of the 5% profits interest? If yes enter the amount, if not enter 0$

2) What is Enriques basis in the partnership interest ?

3) If Enrique also receives a capital account of $25,000 in addition to the 5% profits interest, would he recognize income in the receipt of the profit interest? If yes type the amount if not put $0.