Me and a partner own a partnership that owns a rental property. I am going to buy my partner out, thereby terminating the partnership for tax purposes. My basis in the property (without adjustments) is $42,500 right now. I am buying him out for $92,500. How do I step up my basis to the proper amount on my taxes? I do not believe a section
754 election applies when a partnership is completely bought out and ceases to exist.
Thanks!
========================================= MODERATOR'S COMMENT: Step up?