Thanks Mike.....
To respond to your comment....."if that entry was proper, it would be included on schedule L withdrawals and distributions. the problem with this entry is that the IRS may want you to file the 7217"
The entry was included on the Partnership Form 1065, Schedule K-1 in Section L, Partner's Capital Account Analysis. It is shown as an entry in (.....) for the "Withdrawals and Distributions" line. The "Ending capital account" line value is "0".
So, if I had to file Form 7217, what would I enter in Form 7217, Line 4, "Adjusted basis of the partner's interest in the partnership immediately before the distribution?" Since the partner who gifted the shares to me received the shares as an inheritance, and contributed nothing, I would think, "0".
Thanks again!
