Clint noticed that the Schedule K-1 he just received from ABC Partnership included a $19,100 ordinary business loss allocation. His tax basis in ABC at the beginning of ABC's most recent tax year was $9,100. Comparing the Schedule K-1 he recently received from ABC with the Schedule K-1 he received from ABC last year, Clint noted that his share of ABC partnership debt changed as follows: recourse debt increased from $0 to $1,100, qualified nonrecourse debt increased from $0 to $2,100, and nonrecourse debt increased from $0 to $2,100. Finally, the Schedule K-1 Clint recently received from ABC reflected a $100 cash contribution he made to ABC during the year. Clint is not a material participant in ABC Partnership, and he received $9,100 of passive income from another investment during the same year he received the loss allocation from ABC. How much of the $19,100 loss from ABC can Clint deduct currently, and how much of the loss is suspended because of the tax basis, at-risk, and passive activity loss limitations?

Clint noticed that the Schedule K-1 he just received from ABC Partnership included a $19,100 ordinary business loss allocation. His tax basis in ABC at the beginning of ABC's most recent tax year was $9,100. Comparing the Schedule K-1 he recently received from ABC with the Schedule K-1 he received from ABC last year, Clint noted that his share of ABC partnership debt changed as follows: recourse debt increased from $0 to $1,100, qualified nonrecourse debt increased from $0 to $2,100, and nonrecourse debt increased from $0 to $2,100. Finally, the Schedule K-1 Clint recently received from ABC reflected a $100 cash contribution he made to ABC during the year. Clint is not a material participant in ABC Partnership, and he received $9,100 of passive income from another investment during the same year he received the loss allocation from ABC. How much of the $19,100 loss from ABC can Clint deduct currently, and how much of the loss is suspended because of the tax basis, at-risk, and passive activity loss limitations?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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