w5

Complete the case titled "Small Business-Peachtree" attached above. You will need to down load the case and answer the questions given. Here are some hints that will help you on the case:

I

• Discuss the entity choices available to Peachtree. Include some comments about Form 8832.

II

• What might be the entity’s intent for not making a §754 election? In your discussion, use the terms duplicate loss and substantial built-in loss.
• Consult the “anti-abuse rules” of the regulations to determine which partner(s) can deduct losses from the sale of The Commons.

III

• Trace the basis that Toby should assign to the land and building