[Anonymous]

I need help with couple of questions,

a) shareholder had 1,000 shares with 900 basis and sold for 1100 on january 30, on feb 31 shareholder then bought 500 shares with fmv of 900, what is his tax basis for the new acquisition of shares.

b) 50% partner, had basis of $1000 got nonliquidating distribution of $1000 on january 30. what is his tax basis after the following partnership income are reported for the year:

-$1,000 income

-$1,000 tax exempt income

fairly easy questions, but my brain is shot from overstudying.

[I can do it cpa]

Could I just answer the second one? I just took REG last Saturday so my memory is pretty fresh but somehow problem A is not so tempting..lol

for a 50% partner,

Beginning Basis 1K

Share of Income (both reg.income and tax-exempt income of 2K) 1K

Share of distribution (1K) 500

Ending Tax Basis = 1000 + 1000 – 500 = 1,500

Hope this is correct! =)

IL
FAR-80 |BEC-85 |REG-72,82|AUD-81 |Ethics-Done
Getting it done in 2010! -> GOT IT DONE IN 2010

[whitesoxfancpa]

B is $1,000.

$1,000 initial basis

+ $500 income

+ $500 income

-$1,000 distribution

= $1,000

AUD 96 FAR 95 REG 94 BEC 88

[I can do it cpa]

Distribution will be based on the percentage of partnership interest.

Therefore, it will be 500, not 1,000

IL
FAR-80 |BEC-85 |REG-72,82|AUD-81 |Ethics-Done
Getting it done in 2010! -> GOT IT DONE IN 2010

[Author]

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