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Selling the property and distributing the cash may also make sense in the case of appreciated property since you avoid any arguments over the fair market value of the assets and you'll have the cash to pay any taxes.
Winning such an argument can be difficult and costly.The tax basis (cost less depreciation) is ,840, but the fair market value is ,000.If your real intention is to transfer property from one entity to another, things can get more complicated.Even with an appraisal, the IRS could argue the property's fair market value was higher.Assume Madison distributes two assets at the same time--a truck that had a fair market value of ,000 more than its tax basis (cost less depreciation), and a car with a fair market value of ,000 less than its tax basis.