[startupcfo]

A partnership is formed by two individuals who were previously sole proprietors. Property other than cash which is part of the initial investment in the partnership would be recorded for financial accounting purposes at the

Proprietor’s book values or the fair value of the property at the date of the investment, whichever is higher.
Proprietor’s book values or the fair value of the property at the date of the investment, whichever is lower.
Proprietors’ book values of the property at the date of the investment.

Fair value of the property at the date of the investment.

This answer is correct. The investment in the capital of a partnership should be measured at the fair market value of the assets contributed. This is necessary to achieve equity between the partners. Remember that the partnership is a separate reporting entity; any gains (losses) reported by the partnership should result solely from the activities of the partnership. If the property were recorded by the partnership at the proprietors’ book value, a gain (loss) may ultimately become recognized by the partnership which is actually attributable to the time period prior to when the property was acquired by the partnership.

So if I take a piece of property with a basis of 10,000 and give it to a new partnership when the FMV is 50,000…they’re saying the partnership recognizes the property with a stepped up basis of 50K? Does that mean I experience a 40,000 dollar taxabale gain right away?

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Corporate finance leader

BEC - 87 | 02/28
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[ThomasHallberg]

Sec. 721 provides that no gain or loss is recognized by a partnership or a contributing partner who transfers property to a partnership solely in exchange for a partnership interest. Not FMV

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How does Santa's accountant value his sleigh? Net Present Value

Good luck favors the prepared

KPMG Audit

[Skynet]

In a Marriage, what her's is hers, and what your's is her's.

It's that simple : )

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World Domination Plan

Phase I : Pass CPA Exams - Complete
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Phase IV : Form the new Charlie's Angels with Megan Fox, Scarlett Johansson, & Gal Gadot
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BEC : 78
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AUD : 90

World Domination Plan

Phase I : Pass CPA Exams - Complete
Phase II : Megan Fox - Initiated
Phase III : Bring back 8-Tracks
Phase IV : Megan Fox & Scarlett Johansson Lingerie Pillow Fight
Phase V : TBA

[Author]

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