Under the ordering rules for basis adjustments, the distribution is considered before the loss. If he takes the distribution in 1998 much of the loss will be deferred until 1999 or later. Problem 6 . Problem 7 . Capital is not a material income producing factor to the partnership.
Nothing is stated in the partnership agreement about goodwill.
Problem 8 . Since the total consideration equals Tiffany's basis, it appears that no gain or loss results from the sale. Problem 9 . The RST Partnership makes a proportionate distribution of its assets to Ray, in a complete liquidation of his partnership interest. None of the payment is for partnership goodwill.