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I only need help with the last question in C: If a 754 adjustment is made regarding the sale to Kenneth, both inside and outside
I only need help with the last question in C: If a 754 adjustment is made regarding the sale to Kenneth, both inside and outside bases total $____
Diana, a partner in the cash basis HDA Partnership, has a one-third interest in partnership profits and losses. The partnership's balance sheet at the end of the current year is as follows. Diana sells her interest in the HDA Partnership to Kenneth at the end of the current year for cash of $250,000. If an amount is zero, enter " 0 ". a. How much income must Diana report on her tax return for the current year from the sale? What is its nature? Diana will report ordinary income of and capital gains of $ from the sale. b. If the partnership does not make an optional adjustment-to-basis election, what are the type and amount of income that Kenneth must report in the next year when the receivables are collected? Kenneth must report $ of when the receivables are collected. c. Refer to Example 34 in the textbook. Describe how an out-of-balance situation arises and is resolved for Diana's sale of a partnership interest. Allocate any basis step-up to partnership assets. Hint: You'll need to significantly modify the format for this situation. On the sale of a partnership interest, the new partner's capital account equal the amount paid for the . The sale of a partnership interest is to the partnership and, absent a 754 adjustment/election, the partnership's basis in its assets. If a 754 adjustment is made regarding the sale to Kenneth, both inside and outside bases totalStep by Step Solution
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