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Countryside interest as of January 1, 2000, (2) the changes in
both his share of those liabilities and that basis between
January 1 and the December 26, 2000, liquidating distribution,
and (3) the effect of the liquidating distribution on his share
of those liabilities.
Participating partner represents that Mr. Winn’s adjusted
basis in his interest in Countryside immediately before the
liquidating distribution to him was $19,937,590, and the amount
of money considered distributed to him pursuant to section 752(b)
in connection with the liquidating distribution (i.e., the net
decrease in Mr. Winn’s share of Countryside’s and MP’s
liabilities resulting from the liquidating distribution) was
$19,656,762.11 Because the net decrease in Mr. Winn’s share of
those liabilities resulting from the liquidating distribution
($19,656,762) was less than his adjusted basis for his interest
in Countryside immediately before that distribution
($19,937,590), Mr. Winn argues that, pursuant to section
731(a)(1) (which limits the gain recognized to a partner on any
distribution from a partnership to the amount of money
distributed in excess of the partner’s adjusted basis in the
partnership at the time of the distribution), he realized no gain
on the liquidating distribution.
11 The exhibit states that the liquidating distribution
relieved Mr. Winn of $22,142,736 of Countryside’s liabilities in
existence as of Dec. 26, 2000, but that Mr. Winn’s retained
liability representing his share of CLPP’s share of MP’s $3.4
million (plus interest) liability to CB&T was $2,485,974,
resulting in net relief from liabilities for Mr. Winn of
$19,656,762.
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Last modified: March 27, 2008