Kay joins LWL Partnership as a general partner.
She contributes $30,000 cash as well as a year-old computer system with fair market value (FMV) of $16,000 and adjusted basis $12,800. She also allows the partnership to use her 5-year-old pickup truck for a $150 nominal monthly fee. Kay purchased the truck for $15,000, her adjusted basis, and has current FMV of $8,000. She bought it for personal use and no longer uses it to any great degree.
What is Kay’s basis in LWL Partnership?
*
$54,000
$42,800
$57,800
$46,000