Phillip contributes property (fair market value of $6,000,000 and an adjusted basis of $2,000,000) to TP Partnership. Phillip shares in $3,000,000 of partnership debt under the liability sharing rules, giving him an initial adjusted basis for his partnership interest of $5,000,000. One month after the contribution, Phillip receives a cash distribution from the partnership of $3,000,000. Phillip would not have contributed the property if the partnership had not contractually obligated itself to make the distribution. Assume that Phillip's share of partnership liabilities will not change as a result of this distribution. (I) Under the IRS's likely treatment of this transaction, what is the amount of gain or loss that Phillip will recognize because of the $3,000,000 cash distribution? (II) What is the partnership's basis for the property after the distribution? (III) If Phillip is unhappy with this result, can you suggest a possible alternative that may provide him with a better answer?