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Alice Has a 70% Interest in a Business Entity

Question 15

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Alice has a 70% interest in a business entity. Her basis for her ownership interest is $260,000. The net income of the business for the tax year is $100,000 and the entity liabilities have increased by $50,000. Determine the effect of the earnings and the liabilities on Alice's basis for her ownership interest if the business is:
Alice has a 70% interest in a business entity. Her basis for her ownership interest is $260,000. The net income of the business for the tax year is $100,000 and the entity liabilities have increased by $50,000. Determine the effect of the earnings and the liabilities on Alice's basis for her ownership interest if the business is:

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