Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Molly Grey (single) acquired a 30 percent limited partnership interest in Beau Geste LLP several years ago for $61,000. At the beginning of year 1,

Molly Grey (single) acquired a 30 percent limited partnership interest in Beau Geste LLP several years ago for $61,000. At the beginning of year 1, Molly has tax basis and an at-risk amount of $32,500. In year 1, Beau Geste incurs a loss of $221,000 and does not make any distributions to the partners.

  • In year 1, Molly's AGI (excluding any income or loss from Beau Geste) is $67,000. This includes $17,600 of passive income from other passive activities.
  • In year 2, Beau Geste earns income of $31,400. In addition, Molly contributes an additional $31,000 to Beau Geste during year 2. Molly's AGI in year 2 is $72,100 (excluding any income or loss from Beau Geste). This amount includes $13,720 in income from her other passive investments.

a. Based on the above information, complete the requirements A1 to A3.

image text in transcribed

image text in transcribed

image text in transcribed

Reg A1 Reg A2 Req A3 Based on the above information, complete the following table: (Leave no answers blank. Enter zero if applicable.) At-Risk Amount: Initial year 1 amount Allowed loss End of year 1 at-risk amount Contribution for year 2 BG Income Allowed loss: End of year 2 at-risk amount b. Based on the above Information, complete the requirements B1 to B2. Complete this question by entering your answers in the tabs below. Req B1 Req B2 What are the cumulative total passive suspended losses at the end of year 2? Cumulative total passive suspended losses Reg A1 Reg A2 Reg A3 Based on the above information, complete the following table: (Leave no answers blank. Enter zero if applicable.) At-Risk Total Loss At-Risk Allowed Disallowed Year 1 Year 2 b. Based on the above Information, complete the requirements B1 to B2. Complete this question by entering your answers in the tabs below. Req B1 Req B2 Based on the above information, complete the following table: Year 2 AGI: AGI before Beau Geste Year 2 passive income from Beau Geste Year 2 allowed passive losses Year 2 AGI

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: Robert Libby, Patricia Libby, Daniel Short

5th Edition

0073208140, 978-0073208145

More Books

Students also viewed these Accounting questions

Question

How to Construct a Relative Frequency Histogram

Answered: 1 week ago

Question

develop your skills of project planning.

Answered: 1 week ago

Question

evaluate different research strategies;

Answered: 1 week ago