Question
Molly Grey (single) acquired a 30 percent limited partnership interest in Beau Geste LLP several years ago for $58,500. At the beginning of year 1,
Molly Grey (single) acquired a 30 percent limited partnership interest in Beau Geste LLP several years ago for $58,500. At the beginning of year 1, Molly has tax basis and an at-risk amount of $21,500. In year 1, Beau Geste incurs a loss of $187,000 and does not make any distributions to the partners.
In year 1, Molly's AGI (excluding any income or loss from Beau Geste) is $62,800. This includes $14,500 of passive income from other passive activities.
In year 2, Beau Geste earns income of $34,000. In addition, Molly contributes an additional $30,500 to Beau Geste during year 2. Molly's AGI in year 2 is $68,100 (excluding any income or loss from Beau Geste). This amount includes $10,860 in income from her other passive investments.
A.
Year | Passive activity loss allowed | Passive activity loss disallowed |
1 | 14500 | (7000) |
2 | ?? | ?? |
B. What are the cumulative total passive suspended losses at the end of year 2?
Cumulative total passive suspended losses:??? |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started