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Jangyoun sells investment land having a$30,000 basis to a partnership in which he has a60% partnership interest. The partnership pays$26,000 (FMV) for the land.Later, the

Jangyoun sells investment land having a$30,000 basis to a partnership in which he has a60% partnership interest. The partnership pays$26,000 (FMV) for the land.Later, the partnership sells the investment land to a nonpartner for$31,000. On the sale of theland, the partnership must recognize a

A.

$4,000 capital gain and$1,000 Sec. 1231 gain.

B.

$5,000 capital gain.

C.

$0 gain or loss.

D.

$1,000 capital gain.

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