Masaya owns a passive activity that has a basis of $32,000 and a suspended loss of $13,000 Masaya 's taxable income from active and portfolio income is $73,000 a What is the effect on Masaya 's taxable income if he sells the passive activity for $46,000 b What is the effect on Masaya 's taxable inc...

a Any suspended loss on a passive activity is deductible in full when an entire interest in an activity is disposed of through a sale of the activity ...

Masaya owns a passive activity that has a basis of $32,000 and a suspended loss of $13,000.

Question:

Masaya owns a passive activity that has a basis of $32,000 and a suspended loss of $13,000. Masaya's taxable income from active and income is $73,000.
a. What is the effect on Masaya's taxable income if he sells the passive activity for $46,000?
b. What is the effect on Masaya's taxable income if he sells the passive activity for $26,000?
c. What is the effect on Masaya's taxable income if he dies this year while the fair market value of the passive activity is $40,000?
d. What is the effect on Masaya's taxable income if he dies this year while the fair market value of the passive activity is $22,000?
e. What is the effect on Masaya's taxable income if he gives the passive activity to his daughter Hideko when the fair market value of the passive activity is $40,000? What would the effect of this be on Hideko's taxable income?

Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...