58. Under which of the following circumstances will a partner recognize a loss f
ID: 2601151 • Letter: 5
Question
58. Under which of the following circumstances will a partner recognize a loss from a non-liquidating distribution?
A. A partner will never recognize a loss from a non-liquidating distribution.
B. A partner will recognize a loss from a non-liquidating distribution when the partnership distributes property other than money with an inside basis greater than the partner's basis in the partnership interest.
C. A partner will recognize a loss from a non-liquidating distribution when the partnership distributes money in an amount that is less than the partner's basis in the partnership interest.
D. A partner will recognize a loss from a non-liquidating distribution when the partnership distributes money in an amount that is greater than the partner's basis in the partnership interest.
Explanation / Answer
Answer would be Option C
A partner will recognize a loss from a non-liquidating distribution when the partnership distributes money in an amount that is less than the partner's basis in the partnership interest. Money shall also include unrealized recievables and invenotry.