Stan Had a Basis in His Partnership Interest at the Beginning

Stan had a basis in his partnership interest at the beginning of last year of $30,000. There was no change in partnership liabilities during the year. His share of the partnership's ordinary loss last year was $40,000 and the partnership had no separately stated items. This year, Stan has a distributive share of ordinary income of $30,000. The taxable income from the partnership reported on Stan's personal income tax return this year (ignoring the at- risk and passive activity loss limitations) is

A) $10,000 ordinary loss.
B) $40,000 ordinary income.
C) $20,000 ordinary income.
D) $30,000 ordinary income.

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free