PROBLEMS 1. A and B each contribute $30,000 cash to the ABC partnership and C contributes land held for more than one year, worth $60,000 and subject to a recourse debt of $30,000. A, B and C are all general partners with a one- third interest in the profits and losses of ABC. (a) What are the tax consequences to A, B, C and ABC if the land has a basis to C of $40,000 and the partnership assumes the debt? (b) Same as (a), above, except that the land has a basis to C of $10,000. What could C do to avoid this result? (c) Same as (a), above, except that the debt is nonrecourse, and the partners agree that for purposes of allocating nonrecourse liabilities they each have a one-third interest in profits. (d) Same as (b), above, except that the debt is nonrecourse and the partners agree that for purposes of allocating nonrecourse liabilities they each have a one-third interest in profits. 73 74 Reg. $ 1.7523(a)(2). Reg. $ 1.752-3(a)(3). I.R.C. $$ 733; 752(b). I.R.C. SS 722; 752(a). 75 76