Jay has a tax basis of $34,000 in his partnership interest at the beginning of the partnership tax year. The following amounts of partnership debt were allocated to Jay and are included in his beginning-of-the-year tax basis: (1) recourse debt$23,000, (2) qualified nonrecourse debt$1,000, and (3) nonrecourse debt$2,500. There were no changes to the debt allocated to Jay during the tax year. If Jay is allocated a $35,000 loss for the current year, how much of the loss will be suspended under the tax basis and at-risk limitations?

Multiple Choice

a) $2,500, $1,000

b) $1,000, $2,500

c) $0, $0

d) $34,000, $1,000