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Business, 16.10.2020 17:01 haloom9698

Laurel contributed equipment worth $200,000, purchased 10 months ago for $250,000 cash and used in her sole proprietorship, to Sand Creek LLC in exchange for a 15 percent profits and capital interest in the LLC. Laurel agreed to guarantee all $15,000 of Sand Creek’s accounts payable, but she did not guarantee any portion of the $100,000 nonrecourse mortgage securing Sand Creek’s office building. Other than the accounts payable and mortgage, Sand Creek does not owe any debts to other creditors. a. What is Laurel’s initial tax basis in her LLC interest? b. Laurel’s holding period in the partnership interest begins the day the LLC interest is acquired. True or False?c. What is Sand Creek’s initial basis in the contributed property?

d. What is Sand Creek’s holding period in the contributed property?

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