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Income Tax Corporations Partnerships

Author:
June 17th, 2023

Can you help me understand this?

True/False

The LMO Partnership distributed $30,000 cash to Laura in a proportionate, nonliquidating distribution. Laura’s basis in her partnership interest was $25,000 immediately before the distribution. As a result of the distribution, Laura’s basis is reduced to ($5,000) (negative) and she recognizes no gain or loss.

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