Shelley is a 50 percent partner in the SF Partnership and has an outside basis of $ 56,000 prior to any distributions. She receives an operating distribution of inventory with a basis to the partnership of $ 50,000 and a fair market value of $ 75,000. How much gain does she recognize and what is her basis in inventory and in her partnership interest after the distribution?

Chose one:

No gain, basis in inventory of $ 75,000 and basis in her partnership interest of $ 6,000

Loss of $ 6,000, basis in inventory of $ 56,000 and basis in her partnership interest of $ 0

No gain, basis in inventory of $ 50,000 and basis in her partnership interest of $ 6,000

No of the above is correct

Question

Shelley is a 50 percent partner in the SF Partnership and has an outside basis of $ 56,000 prior to any distributions. She receives an operating distribution of inventory with a basis to the partnership of $ 50,000 and a fair market value of $ 75,000. How much gain does she recognize and what is her basis in inventory and in her partnership interest after the distribution?

Chose one:

No gain, basis in inventory of $ 75,000 and basis in her partnership interest of $ 6,000

Loss of $ 6,000, basis in inventory of $ 56,000 and basis in her partnership interest of $ 0

No gain, basis in inventory of $ 50,000 and basis in her partnership interest of $ 6,000

No of the above is correct

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Shelley is a 50 percent partner in the SF Partnership and has an outside basis of $ 56,000 prior to any distributions. She receives an

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