When High Horizon LLC was formed, Maude contributed the following assets in exchange for a 25 percent capital and profits interest in the LLC:

		Basis		Fair Market Value
Maude:
Cash	$	33,000		$	33,000
Land*		128,000			387,250
Totals	$	161,000		$	420,250

*Nonrecourse debt secured by the land equals $191,500

James, Harold, and Jenny each contributed $228,750 in cash for a 25 percent profits and capital interest

a) What is Maude's tax basis in her LLC interest?

b) What tax basis do James, Harold, and Jenny in their LLC interest?

c)What is High Horizon's tax basis in its assets?

d)

Prepare a tax basis balance sheet for the High Horizon LLC showing the tax capital accounts for the members. (Enter any capital account with a debit balance as a negative amount.)

Assets:

Cash

Land

Total:

Liabilities and capital

Mortgage debt

Capital-Maude

Capital - James

Capital Harold

totals