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The equal XYZ Partnership has the following balance sheets: Basis FMV Cash $54,000 $54,000 Land $21,000 $42,000 Unrealized Receivables $0 $15,000 Collectibles $3,000 $9,000 $78,000
The equal XYZ Partnership has the following balance sheets:
|
| Basis | FMV | ||
Cash |
| $54,000 | $54,000 | ||
Land |
| $21,000 | $42,000 | ||
Unrealized Receivables | $0 | $15,000 | |||
Collectibles | $3,000 | $9,000 | |||
|
| $78,000 | $120,000 | ||
|
|
|
| ||
Liabilities |
| $30,000 | $30,000 | ||
|
|
|
| ||
Capital, X |
| $12,000 | $30,000 | ||
Capital, Y |
| $18,000 | $30,000 | ||
Capital, Z |
| $18,000 | $30,000 | ||
|
| $78,000 | $120,000 | ||
XYZ has a Code Section 754 election in effect, and X sells her interest to W for $30,000 cash. However, the land was contributed by X at a time when its FMV exceeded its basis by $6,000. How much is the Code Sec. 743(b) adjustment?
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