LO.2 Tom and Liz form an equal partnership with a $60,000 cash contribution from Tom DE C I S ION MAKING and a contribution of property (basis of $75,000, fair market value of $60,000) from Liz.

a. Compute Liz’s realized and recognized gain or loss from the contribution.

b. Compute Tom’s basis in his partnership interest.

c. Compute Liz’s basis in her partnership interest.

d. What basis does the partnership take in Liz’s contributed asset?

e. Are there more tax-effective ways to structure the transaction?