Question

"A customer subscribes to a $100,000 limited partnership interest. The commission is $10,000. The up-front costs are $500 for legal expenditures, and $500 for organization costs. What is the customer's beginning tax basis?"

Answer 1

$100,000

Step-by-step explanation:

Based on the information given we were told that the customer subscribes for a limited partnership interest for the amount of $100,000, this means that the amount of $100,000 will be the customer's beginning tax basis because the amount that was used when the customer subscribed to the limited partnership interest is the initial cost.

Therefore the beginning tax basis will be $100,000