Erica and Brett decide to form their new motorcycle business as an LLC. Each will receive an equal profits (loss) interest by contributing cash, property, or both. In addition to the members' contributions, their LLC will obtain a $50,000 nonrecourse loan from First Bank at the time it is formed. Brett contributes cash of $5,000 and a building he bought as a storefront for the motorcycles. The building has an FMV of $45,000 and an adjusted basis of $30,000 and is secured by a $35,000 nonrecourse mortgage that the LLC will assume. What is Brett's outside tax basis in his LLC interest?
A. $40,000.
B. $42,500.
C. $45,000.
D. $37,500.
Answer: C
Business
You might also like to view...
Since 2010, the average hiring process has ______.
a. slowed by about 21 days b. slowed by about 8 days c. stayed about the same d. sped up by about 12 days
Business
Discuss some of the factors that could motivate an organization to implement activity based costing
Business
Contraction rate is the duration at which the project can be compressed with available resources
Indicate whether the statement is true or false
Business
An offer to perform is known as a(n) __________.?
A) rendering B) offering C) tinder D) tender
Business