Father & Son each own 30% interest in FSA partnership. Mom who holds no interest in the partnership sells land to the FSA partnership for a $10,000 gain. Mom held the land as investment property while the partnership will build a factory on the land.

Which of the following statements is FALSE?

A.Mom will recognize $10,000 in ORDINARY income even though the land was a capital asset in her hands.

B.Mom will recognize $10,000 in CAPITAL gain

C.If FSA partnership had held the land as an investment, Mom would recognize $10,000 in CAPITAL gain

D.All of the above statements are TRUE!