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Mike and Jennifer Form an Equal Partnership

Question 65

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Mike and Jennifer form an equal partnership. Mike contributes cash of $15,000 and Jennifer contributes land having a $15,000 FMV and a basis of $5,000. If the partnership sells the land three years later for $18,000, what are the tax consequences to Mike and Jennifer?

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The precontribution gain of $10,000 ($15...

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