If all allocations and distributions from Smart & Smarter to its partners during or for those three years were pro rata, what is your adjusted basis in your partner-ship interest at January 1, Year D?
If all allocations and distributions from Smart & Smarter to its partners during or for those three years were pro rata, what is your adjusted basis in your partner-ship interest at January 1, Year D?
Chapter10: Partnerships: Formation, Operation, And Basis
Section: Chapter Questions
Problem 39P
Related questions
Question
After a mere six years of blood, sweat and tears, you made partner in your accounting firm, Smart & Smarter, LLP. You made your initial capital contribution of $250,000 on January 1, Year A, and in exchange received a .4% equity inter-est in the
- Smart & Smarter’s Year A partnership return, Form 1065, reported ordin-ary business income of $160,096,336. Smart & Smarter distributed an ag-gregate total of $142,834,019 cash to its partners during the year.
- Smart & Smarter’s Year B Form 1065 reported ordinary business income of $180,440,025. Smart & Smarter distributed an aggregate total of $165,316,650 cash to its partners during the year.
- Oops! Smart & Smarter’s Year C Form 1065 reported a net operating loss of $22,090,046. Nevertheless, Smart & Smarter distributed an aggregate total of $126,960,260 cash to its partners during the year.
If all allocations and distributions from Smart & Smarter to its partners during or for those three years were pro rata, what is your adjusted basis in your partner-ship interest at January 1, Year D?
Note: Round all number-crunching results to the nearest dollar.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT