Basis of Partner's Interest

Free CPA TCP (Tax Compliance & Planning) lesson in Entity Tax Compliance. 18 min read, ~2,688 words.

Initial outside basis equals cash contributed plus adjusted basis of property contributed, reduced by liabilities assumed by the partnership and increased by the partner's share of partnership liabilities. Contributions of encumbered property create a two-step basis adjustment: decrease for the full liability transferred, increase for the partner's allocable share of...