Investment Activities

The Adam’s did not own, control or manage any foreign bank accounts, nor were they grantors or beneficiaries of a foreign trust during the tax year.

The Adam’s received the following interest and dividends during the year.

Interest Income	Amount
Commerce Bank	$6,000
City of Kansas City, MO bonds	$3,600
U.S. Treasuries	$2,800

Dividend Income	Ordinary Dividends	Qualified Dividends
Amen Inc.	$10,000	$9,400
Masters, Inc.	$5,000	$4,700
Tiger Company	$3,500	$3,400

The Adam’s sold the following stock during the year.

Stock	Date Purchased	Date Sold	Amount Realized	Tax Basis
Dustin, Inc.	1/10/2004	9/30/2020	$150,000	$37,500
Augusta Company	2/9/2020	1/15/2020	$25,000	$21,200
Bubba, Inc.	2/7/2019	7/8/2020	$12,500	$20,700
Zach Johnson, Inc.	11/14/2014	3/1/2020	$20,000	$19,025

The Adam’s have a $4,000 long-term capital loss carryover from the prior tax year.

Bailey is a 10% owner in a real estate partnership named Double-Dipping, LP (EIN 50-7654321). The limited partnership reported ordinary business income for the year, of which $35,000 was Bailey’s share. Bailey received a K-1 from the limited partnership reporting her allocable share of the business income. Bailey acquired the interest several years ago. Her basis in the limited partnership and at-risk amount before considering her 2020 income allocation was $42,000. Bailey is a passive owner with respect to this entity.

Grant is a 20% owner in Natural Sunshine, Inc. (“NS”) (EIN 24-9876543). NS is a Subchapter S corporation. The company reported an ordinary business loss for the year of, which $40,000 was Grant’s share. Grant received a K-1 from NS reporting his allocation of this business loss. Grant acquired the stock several years ago. His basis in the stock and at-risk amount before considering the 2020 loss allocation was $25,000. Grant is a passive owner with respect to this entity.

Grant and Bailey are Married Filing Joint with 2 Dependents.

a What is the overall Net Gain or Loss

b What is the Tax basis Limit, At Risk Limit and Passive Loss Limit for Grant and Bailey.

c What is the Adams Total Deductible Losses for the year?

d. How would these go on a tax return?