XYZ is a limited partnership. Josie is the general partner and has a 60 % interest in partnership capital and profits. Eva is the limited partner and has a 40 % interest in capitaland profits. XYZ borrows $100,000 on a recourse basis . What is the impact of XYZ's borrowing on the tax basis each partner has in their partnership interests ?

A.Josie's basis increases by $100,000 ; Eva's basis is unchanged.

B.Neither partners basis changes as a result of the borrowing.

C.Josie's basis increases by $60,000 ; Eva's basis increases by $40,000

D. Josie's basis increases by $60,000; Eva's basis is unchanged