TXX5768

When a taxpayer contributes real estate or other property to a partnership, the taxpayer must keep track of his or her adjusted basis in the partnership interest that is acquired. All of the following are important tax reasons for taxpayers to account for their basis in their partnership interests except which of the following:

	A.	If a partner sells his partnership interest, the adjusted basis must be known to calculate the taxable gain or loss on the sale.
	B.	The partner's basis in the partnership interest is a ceiling on the amount of losses that can pass through to that partner in a given tax year.
	C.	The partner's basis in his partnership interest sets the limit on the amount of distributions from the partnership that partner may receive in a given tax year without creating a taxable event.
	D.	A partner's basis in his partnership interest determines the tax consequences to that partner when the partnership is liquidated.
	E.	All of the above are important reasons for tracking basis in the partnership interest
	F.	Only A, & B are important reasons for tracking basis in partnership interests.