Tax consequences of sale and land when forming a partnership Mike and Lisa formed a partnership at t

Tax consequences of sale and land when forming a partnership

Mike and Lisa formed a partnership at the beginning of the
year They were equal partners and they had the same basis When the
partnership was formed, Mike contributed the following items:

Basis FMV

Building $150,000 $200,000

Land $ 60,000 $ 70,000

Equipment $50,000 $ 40,000

Total $260,000 $310,000

In order to raise funds for operation of the business the
partnership sold both the land and building in the 5th month of operation

The land was sold for $70,000 and the building was sold for
$230,000

What are the tax consequences of the sale of the land and
building on each of the partners?

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