Lonnie Davis has been a general partner in the Highland Partnership for many years and is also a sole proprietor in a separate business. To spend more time focusing on his sole proprietorship, he plans to leave Highland and will receive a liquidating distribution of $68,500 in cash and land with a fair market value of $122,000 (tax basis of $138,000). Immediately before the distribution, Lonnie's basis in his partnership interest is $418,000, which includes his $78,500 share of partnership debt. The Highland Partnership does not hold any hot assets. a. What are the amount and character of any gain or loss to Lonnie? $136,000 capital loss $271,000 section 1231 loss $136,000 section 1231 loss Neither gain nor loss recognized $271,000 capital loss Lonnie Davis has been a general partner in the Highland Partnership for many years and is also a sole proprietor in a separate business. To spend more time focusing on his sole proprietorship, he plans to leave Highland and will receive a liquidating distribution of $68,500 in cash and land with a fair market value of $122,000 (tax basis of $138,000). Immediately before the distribution, Lonnie's basis in his partnership interest is $418,000, which includes his $78,500 share of partnership debt. The Highland Partnership does not hold any hot assets. b. What is Lonnie's basis in the land? Basis