Problem 11-43 Sale of Passive Activity and Suspended Losses (LO. 3)

Sarah has investments in four passive activity partnerships purchased several years ago. Last year the income and losses were as follows:

Activity	Income (Loss)
A	30,000
B	(30,000)
C	(15,000)
D	(5,000)

b. What amount of the suspended losses is allocated to Activity D? The net gain from the sale of Activity D (before any passive losses from the other activities) is? How much, if any, of this net gain may be used to absorb passive losses from other activities?