Question
Exercise 21-20 (Algorithmic) (LO. 8) When Padgett Properties LLC, was formed, Nova contributed land (value of $318,000 and basis of $79,500) and $159,000 cash, and
Exercise 21-20 (Algorithmic) (LO. 8)
When Padgett Properties LLC, was formed, Nova contributed land (value of $318,000 and basis of $79,500) and $159,000 cash, and Oscar contributed cash of $477,000. Both members received a 50% interest in LLC profits and capital.
a. How is the land recorded for 704(b) book capital account purposes?
For 704(b) book capital account purposes, Padgett records the land at $_____________________.
b. What is Padgett's tax basis in the land? $_________________
c. If Padgett sells the land several years later for $477,000, Nova reports a $________________ gain and Oscar's gain is $_______________.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started