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sleet_krkn [62]
3 years ago
6

Andy is talking to his friend Bruce, who has an interest in Arlington, LLC, about purchasing his LLC interest. Bruce’s outside b

asis in Arlington, LLC is $21,000. This includes his $5,000 one-fourth share of the LLC’s debt. Bruce’s 704(b) capital account is $25,000. If Andy bought Bruce’s LLC interest for $18,000, what would Andy’s outside basis be in Arlington, LLC?
Business
1 answer:
dangina [55]3 years ago
7 0

Answer:

$23,000

Explanation:

LLC interest for $18,000 +$5,000 one-fourth share of the LLC’s debt

=$23,000

Therefore If Andy bought Bruce’s LLC interest for $18,000, Andy’s outside basis in Arlington, LLC will be $23,000 because Andy's basis would equal the amount he paid for his LLC interest plus his share of the LLC debt which is why he would have a starting basis of $18,000 + $5,000 of LLC debt, or $23,000

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