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petitioner contributed only cash to the partnerships and received
only cash as distributions. Moreover, petitioner agrees that the
Schedules K-1 accurately reflect the amount of the beginning
capital account balances, income, distributions, and ending
capital account balances for the year in issue. Therefore, each
capital account balance accurately reflects petitioner's basis in
the respective partnership.
Petitioner also argues that his adjusted basis should not be
reduced by his distributive share of IDC. Petitioner agrees that
all of the partnerships took deductions for IDC and that the
capital account balances on the Schedules K-1 reflect a downward
adjustment due to IDC. The following table sets out the
beginning capital account balances for the year in issue for each
of the partnership interests with and without the effects of IDC:
Name Cap. Acct. With IDC Cap. Acct. W/Out IDC
Dime Box II $373 $7,183.74
Dime Box III (Pet.) 3,051 20,547.59
Dime Box III (M&A) 763 5,136.67
CAG Farmout 2,109 15,460.28
66 Farmout (Pet.) (761) 11,675.89
66 Farmout (M&A) (508) not available
In petitioner's view, however, because IDC is counted in
calculating each partnership's income, it is not proper to count
5(...continued)
determine a partner's adjusted basis in the partnership interest,
the adjusted basis of contributed or distributed property is
added to or subtracted from his adjusted basis in the partnership
interest. See, e.g., secs. 722, 733.
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