LO.2 Liz and John formed the equal IJ Partnership on January 1 of the current year. Liz contributed $80,000 of cash and land with a fair market value of $90,000 and an adjusted basis of $75,000. John contributed equipment with a fair market value of $170,000 and an adjusted basis of $20,000. John previously used the equip- ment in his sole proprietorship.

a. How much gain or loss will Liz, John, and IJ realize?

b. How much gain or loss will Liz, John, and IJ recognize? C. What bases will Liz and John take in their partnership interests?

d. What bases will IJ take in the assets it receives?

e. How will IJ depreciate any assets it receives from the partners?