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 $194,500 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 $21,830 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 following table:

At risk amount

Initial year 1 amount

?

Allowed loss

?

End of Year 1 at risk amount

0

Contribution for Year 2

?

BG Income

?

Allowed loss

?

end of year 2 risk amount

?

Year

Total Loss

At risk allowed

At risk disallowed

1

?

?

?

2

?

?

?

Year

At risk allowed

Passive activity loss allowed

Passive activity loss disallowed

1

?

?

?

2

?

?

?

At end of year 2

Cumulative total passive suspended losses ?

Year 2 AGI

AGI before BG

?

Year 2 passive income from BG

?

Year 2 allowed passive losses

?

Year 2 AGI

?

If any doubt please comment

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

Step: 3

blur-text-image

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

More Books

Students also viewed these Accounting questions