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I can't seem to figure out part C of this problem for the suspended under the passive activity loss rules and the adjusted basis in
I can't seem to figure out part C of this problem for the suspended under the passive activity loss rules and the adjusted basis in the activity.
Five years ago, Gerald invested $182,000 in a passive activity, his sole investment venture. On January 1, 2018, his amount at risk in the activity was $36,400. His shares of the income and losses were as follows: Year Income (Loss) 2018 2019 ($54,600) (36,400) 56,400 2020 Gerald holds no suspended at-risk or passive activity losses at the beginning of 2018. If an answer is zero, enter "0". a. If losses were limited only by the at-risk rules, how much can Gerald deduct in 2018 and 2019? Year Loss Allowed Suspended 2018 ($54,600) $ 36,400 18,200 2019 ($36,400) 36,400 Total $ 54,600 b. Refer to the information in part (a) above. If losses were limited by the at-risk and the passive activity loss rules, how much would Gerald be able to deduct in 2018 and 2019? Of the allowable at-risk loss for 2018, Gerald may deduct $ 0 in 2018 due to the passive loss rules and of the allowable at-risk loss from 2019, Gerald may deduct $ O in 2019 due to the passive loss rules. Feedback c. Assuming Gerald has $50,000 income in 2020, (and considering both at-risk and passive activity loss rules), what is the amount of Gerald's suspended losses at the end of 2020? Suspended under the at-risk rules: $ Suspended under the passive activity loss rules: $ 13,600 X What is his taxable income for 2020? $ At the end of 2020, what is the amount of Gerald's adjusted basis in the activity? $ 4,600 x Five years ago, Gerald invested $182,000 in a passive activity, his sole investment venture. On January 1, 2018, his amount at risk in the activity was $36,400. His shares of the income and losses were as follows: Year Income (Loss) 2018 2019 ($54,600) (36,400) 56,400 2020 Gerald holds no suspended at-risk or passive activity losses at the beginning of 2018. If an answer is zero, enter "0". a. If losses were limited only by the at-risk rules, how much can Gerald deduct in 2018 and 2019? Year Loss Allowed Suspended 2018 ($54,600) $ 36,400 18,200 2019 ($36,400) 36,400 Total $ 54,600 b. Refer to the information in part (a) above. If losses were limited by the at-risk and the passive activity loss rules, how much would Gerald be able to deduct in 2018 and 2019? Of the allowable at-risk loss for 2018, Gerald may deduct $ 0 in 2018 due to the passive loss rules and of the allowable at-risk loss from 2019, Gerald may deduct $ O in 2019 due to the passive loss rules. Feedback c. Assuming Gerald has $50,000 income in 2020, (and considering both at-risk and passive activity loss rules), what is the amount of Gerald's suspended losses at the end of 2020? Suspended under the at-risk rules: $ Suspended under the passive activity loss rules: $ 13,600 X What is his taxable income for 2020? $ At the end of 2020, what is the amount of Gerald's adjusted basis in the activity? $ 4,600 xStep by Step Solution
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