Problem: Module 7 Textbook Problem 5 Learning Objectives: 7-6 Adjust the tax basis in a partnership interest 7-7 Apply the basis limitation on the deduction of partnership losses This year, individual Kale and individual Spinach formed Leafy Green Partnership Kale contributed $66.750 cash, and Spinach contributed business assets with a $66.750 FMV Spinach's adjusted basis in these assets was only $13,350. The partnership agreement provides that income and loss will be divided equally between the two partners. Partnership operations for the year generated a $42,600 loss Required: How much loss may each partner deduct currently, and what basis will each partner have in her interest at the beginning of next year? Determine the loss each partner can deduct currently considering the basis loss limitation, but no other loss limitations. (Losses and deductions should be entered os negative numbers.) Partner Kale Partner Spinach Initial basis in partnership Interest Deduction for share of partnership loss Adjusted basis at beginning of next year Problem: Module 7 Textbook Problem 2 Learning Objective: 7-4 Explain the flow-through of partnership items to the partners This year, Herb Partnership generated $610,000 ordinary business income, Herb has two equal partners: Savory LLC and Sweet Corp. ans corporation Savory LLC has three members. Mr. Parsley, an individual who owns a 45 percent interest Mrs. Rosemary, an Individual who owns a 35 percent interest, and Sage Inc, a C Corporation which owns a 20 percent interest Sweet Corp, has 100 shares of outstanding stock, all of which are owned by Ms. Mint, an individual Required: Identify the taxpayers who must pay tax on the partnership income, and determine how much income must be reported by each. If a taxpayer does not have to pay tax due to Herb Partnership's allocated income, put "O" for the answer Amount of Income Allocated from Herb Partnership Mr Parsley Mrs. Rosemary Sage Inc Ms Mint Savory LLC Sweet Corp