Requirement #$4$:

Using the facts from Requirement #$3$ above, if MBRC liquidates Marty's interest, what is Marty's basis in the distributed assets? Hint: The actual cash received is given above under Requirement #$3.$ For the remaining assets, you must determine if you are using the Tax Basis or FMV and apply only Marty's ownership $\%.$

$\backslash$table$[[$Cash$,],[$Receivables$,],[$Inventory$,],[$Land$,]]$

Requirement #$5$:

Compare and contrast Marty's options for terminating his partnership interest by answering the questions below. Assume that Marty's marginal tax rate is $35\%$ and his capital gains rate is $15\%.$

How much tax will Marty pay under option #$1?($Hint: There are two types of gain involved: ordinary and capital$).$

Assuming Marty sells the distributed assets right after the distribution under option #$2,$ how much tax will Marty pay? Complete the chart below. Remember, Marty's share of the assets is only $50\%.$

$\backslash$table$[[,$Tax Basis,FMV$,$Gain $($Loss$),$After$-$Tax Cash$],[$Cash received,,,,$],[$Receivables$,,,,],[$Inventory$*,,,,],[$Land$**,,,,]]$

After$-$tax cash $=$ Proceeds received Gain $x$ Ordinary tax rate