Perry partnership distributed cash of $15,000 and a parcel of land in a liquidating distribution to gupta, a partner. the land had a fair market value of $50,000 and an inside basis of $52,000 at the time of the distribution. gupta's outside basis in perry just prior to the distribution was $70,000. what is gupta's resulting basis in the land?

a. $50,000

b. $55,000

c. $53,000

d. $52,000

option (b) $55,000

Explanation:

Data provided in the question:

Cash distributed = $15,000

Fair market value of the land = $50,000

Inside basis at the time of the distribution = $52,000

Gupta's outside basis = $70,000

Now,

Gupta's Outside basis = Cash + Basis in land

or

$70,000 = $15,000 + Basis in land

or

Basis in land = $70,000 - $15,000

or

Basis in land = $55,000

Hence,

The answer is option (b) $55,000

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