LO.1, 2, 3, 4, 5, 6, 8, 10, 12 Comment on the validity of each of the following statements.

a. A partner may recognize a capital gain if a proportionate nonliquidating distribution of cash exceeds the partner’s basis in the partnership interest.

b. A partner may recognize a capital loss in a proportionate liquidating distribution if the assets received include cash, a marketable security, and land.

c. In a proportionate liquidating distribution, if a partner receives cash equal to the basis in the partnership interest, any other property received will take a $0 basis.

d. If a partner contributes property with a precontribution gain and that property is later distributed to another partner, the contributing partner generally must recognize a capital gain in the amount of any previously unrecognized precontribution gain.

e. In a disproportionate distribution, either the partnership or the distributee partner might be required to recognize ordinary income.

f. In a redemption of a partnership interest under § 736, a payment to a limited partner in a service partnership for goodwill that is provided for in the partnership agreement is treated as a § 736

(b) property payment.
g. Under § 736, all payments to a retiring partner are either property payments [§ 736(b)] or income payments [§ 736(a)].
h. In a sale of a partnership interest, the partner will recognize capital gain to the extent that the selling price exceeds the partner’s basis in the partnership interest.
i. A partnership may make a § 754 election if a partner recognizes gain on a distribution of cash from the partnership.
j. A § 754 election might be appropriate if a partner purchases a partnership interest from another partner for substantially less than the partner’s share of the underlying basis in partnership assets.
k. A family member can be recognized as a partner in a partnership in which capital is not a material income-producing factor only if that partner provides substantial services to the partnership.
l. Both the tax and the economic consequences are the same whether a partnership redeems the partner’s interest in the partnership or that interest is sold to a new partner for an equivalent amount of cash.