Problem: Carmin performs services in exchange for a 25% interest in Real Estate Rental Partnership. The services were worth $23,500. The tax implications to Carmin are:
Multiple Choice:
- $23,500 of taxable income and a partnership interest with a basis of $23,500.
- No taxable income and a partnership interest with a basis of $0.
- No taxable income and a partnership interest with a basis of $23,500.
- $23,500 of taxable income and a partnership interest with a basis of $0.