Lola is a 35 percent partner in the LW Partnership. On January 1, LW distributes $39,000 cash to Lola in complete liquidation of her partnership interest. LW has only capital assets and no liabilities at the date of the distribution. Lola's basis in LW is $30,000. What is the amount and character of Lola's gain or loss?
What will be an ideal response?
$9,000 capital gain.
Lola's gain is calculated as the difference between her basis in LW and the cash distribution of $39,000.
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