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14-3. LO.2 Wozniacki and Wilcox form Jewel LLC, with each investor receiving a one-half interest in the capital and profits of the LLC. Wozniacki receives his one-half interest as compensation for tax planning services that he rendered prior to the formation of the LLC. Wilcox contributes $50,000 cash. The value of a one-half capital interest in the LLC (for each of the parties) is $50,000. a. Compute Wozniacki’s realized and recognized gain from joining Jewel. b. Compute Wozniacki’s basis in his interest in Jewel. c. How does Jewel treat the services that Wozniacki has rendered?
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