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Unformatted text preview: + Debt relief 14,000 Amount realized 15,000 Basis in partnership interest (6,000) Recognized gain on sale 9,000 The recognized gain increased Mr. Cheney’s at-risk amount to $9,000, thereby allowing him to deduct his $8,000 suspended loss under the at-risk limitation. The recognized gain of $9,000 is reduced by the $8,000 suspended loss. Mr. Cheney recognizes a gain of $1,000 on his tax return. This is not a coincidence; usually the difference between a partner’s basis & their at-risk amount is the partner’s share of nonrecourse debt. Therefore, the recognized gain must be at least as much as the excess of nonrecourse debt over basis....
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This note was uploaded on 09/09/2011 for the course TAX 6845 taught by Professor Kelliher,c during the Fall '08 term at University of Central Florida.
- Fall '08