Asked by Eskarlin Sanchez on Jun 06, 2024
Verified
Typically,a partner does not recognize a gain when he or she receives a current distribution.
Current Distribution
This refers to the disbursement of a fund's or company’s earnings to its shareholders or partners.
- Become familiar with the conditions prompting partners to realize gains or losses during the formation of a partnership, the contribution of assets, or the receipt of distributions.
Verified Answer
JD
Jaspreet DhaliwalJun 10, 2024
Final Answer :
True
Explanation :
According to the general tax rules for partnership distributions, a partner does not recognize a gain when receiving a current distribution unless the amount received exceeds the partner's basis in the partnership interest (in which case, the excess amount is treated as a gain).
Learning Objectives
- Become familiar with the conditions prompting partners to realize gains or losses during the formation of a partnership, the contribution of assets, or the receipt of distributions.
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