The balance sheet of RST Partnership shows the following:

	Inside Basis	Fair Market Value
Cash	30,000	30,000
Accounts Receivable	20,000	20,000
Inventory	105,000	112,000
Section 1231 assets	94,000	147,000
	= 249,000	= 309,000
Liabilities	9,000	9,000
R, Capital	80,000	100,000
S, Capital	80,000	100,000
T, Capital	80,000	100,000
	= 249,000	= 309,000

During the current year, partners S and T agree to liquidate Rs interest in the partnership for $115,000, to be paid in annual installments of $23,000 each over a five year period. Rs basis in his interest (including his one-third share of partnership liabilities) is $83,000. Capital is a material income-producing factor to the RST Partnership and the partnership has no unrecorded goodwill.

a. What are the tax consequences to R of the series of cash distributions from the partnership?

b. What are the consequences to the partnership of the liquidating distributions?