Mike and Melissa form the equal MM Partnership. Melissa contributes the assets of her sole proprietorship (value of $140,000, adjusted basis of $115,000). Mike sells his land (fair market value of $100,000, adjusted basis of $120,000) to a third party for $100,000 and then contributes that cash as well as an additional $40,000 to the partnership. The partnership locates equivalent land that it purchases for $110,000.

How do these changes affect the tax and economic result for Mike and the partnership?

Mike has a realized loss of $______ on the sale of the land of which $_____ is recognized. Mike recognizes no gain or loss on his contribution to the partnership and has a basis of $_____ in his partnership interest. The partnership incurs a $_____ economic cost when it purchases equivalent land instead of receiving the land as a contribution from Mike.