CPAnet Forum: partnership

Active Topics

Memberlist

Help

REG STUDY GROUP
CPAnet Forum : REG STUDY GROUP

Topic: partnership (

Topic Closed)

Author

Message

<< Prev Topic | Next Topic >>

aimtobeacpa
Major Contributor

Joined: 10 Dec 2009
Online Status: Offline
Posts: 657

Posted: 07 May 2011 at 16:54 \| IP Logged

xyz partnership owns a warehouse with adjusted basis of 120k subject to mortgage of 90k.partner X has a basis for his partnership int of 75000.if the partnership transfers the warehouse and mortgage to partner X as a current distribution,X;s basis for his partnership int immediately foll the distribution would be??
ans 15ooo

can someone solve this?

__________________
BEC-74,82(lost credit),78
FAR-67,80
AUD-75
REG-68,72,79

liulucy123
Newbie
Newbie

Joined: 07 May 2011
Online Status: Offline
Posts: 1

Posted: 07 May 2011 at 18:56 \| IP Logged

Beginning basis & nbsp; 75,000
assumption of mortgage 90,000
= 165,000
-distribution of warehouse (120,000)
-share of liability decrease (30,000)
basis after & nbsp; & nbsp; = 15,000

As 1/3 shareholder, X has 30k basis for mortgage b4 ditribution, so actually his basis for mortgage increase 60k.from 30k to 90k.

aimtobeacpa
Major Contributor

Joined: 10 Dec 2009
Online Status: Offline
Posts: 657

Posted: 07 May 2011 at 23:09 \| IP Logged

i am having problem understanding it conceptually...can u plz explain in words..

y distribution of warehouse is subtracted from his total basis...is it bec it no longer belongs to partnership??
and initially it assumes the whole mortgage which increases its basis...then y 1/3rd is subtracted?

__________________
BEC-74,82(lost credit),78
FAR-67,80
AUD-75
REG-68,72,79

jiejenn
Major Contributor

Joined: 18 Dec 2009
Location: United States
Online Status: Offline
Posts: 337

Posted: 08 May 2011 at 00:17 \| IP Logged

The question is missing some detail XYZ partnership as X and Y and Z each own 1/3 of the partnership or X owns XYZ partnership?

If X owns 1/3 of the partnership's interest, then liulucy123 is right.

__________________
Far: 04/01/2011 {75)
Aud: 04/15/2011 (77)
Bec: 04/25/2011 (75)
Reg: 05/13/2011 (59) ah

Check out my Excel Channel

thechamp26
Contributor

Joined: 11 Aug 2010
Online Status: Offline
Posts: 52

Posted: 08 May 2011 at 20:46 \| IP Logged

Think about it like this... X is already responsible for
1/3rd of the mortgage (or 30,000). The partner's basis
changes once property is contributed or distributed,
therefore, 30,000 is already included in partner X's basis
before the property is distributed.

So what are the "actual" amounts that are distributed to
partner X? 120,000 for the warehouse and 60,000 (remember
30,000 is already built into partner X's basis) for the
mortgage liability.

Page of 2 Next >>

Printable version

You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot delete your posts in this forum
You cannot edit your posts in this forum
You cannot create polls in this forum
You cannot vote in polls in this forum