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Bryan,Shahin,and Michele form a partnership.Bryan and Shahin contribute inventory and a building,respectively.Michele agrees to perform all of the accounting and office work in exchange for a 10% interest.
FMV Basis Partnership % Bryan’s inventory $300,000$225,00045% Shahin’s building $300,000$125,00045% Michele’s services $0$010%\begin{array}{llll}&FMV&\text { Basis }&\text { Partnership }\%\\\text { Bryan's inventory } & \$ 300,000 & \$ 225,000&45\% \\\text { Shahin's building } & \$ 300,000 & \$ 125,000&45\% \\\text { Michele's services } & \$ 0 & \$0&10\%\end{array} Bryan’s inventory Shahin’s building Michele’s services FMV$300,000$300,000$0 Basis $225,000$125,000$0 Partnership %45%45%10% a.Do any of the partners recognize any gain? If so,how much and why?
b.What is each partner's basis in his or her partnership interest?
c.What is the basis to the partnership of each asset?
On Jun 28, 2024
a.Michele will recognize $60,000 as a guaranteed payment.She receives a capital interest in exchange for services ($600,000 FMV × 10% interest).
b. Bryan’s partnership basis $225,000 Shahin’s partnership basis $125,000 Michele’s partnership basis $60,000\begin{array}{lr}\text { Bryan's partnership basis } & \$ 225,000 \\\text { Shahin's partnership basis } & \$ 125,000 \\\text { Michele's partnership basis } & \$ 60,000\end{array} Bryan’s partnership basis Shahin’s partnership basis Michele’s partnership basis $225,000$125,000$60,000
c. Inventory $225,000 Building $125,000\begin{array}{ll}\text { Inventory }&\$225,000\\\text { Building }&\$125,000\end{array} Inventory Building $225,000$125,000