Facts - Two member LLC treated as a partnership for tax purposes with each member owing 50%. Partner A purchased all of partner B's interest in the partnership at the end of 2008. With partner A's purchase it automatically caused the partnership to terminate creating a liquidating distrubution. The only asset in the partnership was a warehouse with a net book value of $708,000.
Question - How is depreciation handled on the warehouse going forward? There was 3 years of depreciation taken including 2008. I beleive partner A now has two sets of basis. one when he was in the partnership and one for the monies paid for the remaing 50% interest in the LLC. Does depreciation on the warehouse start over and only for the amount of Partner A's total basis including any debt basis? Any help would be appreciated.
Question - How is depreciation handled on the warehouse going forward? There was 3 years of depreciation taken including 2008. I beleive partner A now has two sets of basis. one when he was in the partnership and one for the monies paid for the remaing 50% interest in the LLC. Does depreciation on the warehouse start over and only for the amount of Partner A's total basis including any debt basis? Any help would be appreciated.