Tobias is a 50% partner in Solomon LLC, which does not invest in real estate. On January 1, Tobias's adjusted basis for his LLC interest is $176,000, and his at-risk amount is $140,800. His share of losses from Solomon for the current year is $228,800, all of which is passive. Tobias owns another investment that produced $123,200 of passive activity income during the year. (Assume that Tobias is a single taxpayer, there were no distributions or changes in liabilities during the year, and the Solomon loss is Tobias's only loss for the year from any activity.) How much of Solomon's losses may Tobias deduct on his Form 1040? How much of the loss is suspended, and what Code provisions cause the suspensions? Applicable Provision Deductible Loss Suspended Loss Overall limitation $_________ $___________ At-risk limitation $__________ $___________ Passive loss limitation $_________ $____________ Therefore, Tobias can deduct $_____________ on his return in the current year.
Tobias is a 50% partner in Solomon LLC, which does not invest in real estate. On January 1, Tobias's adjusted basis for his LLC interest is $176,000, and his at-risk amount is $140,800. His share of losses from Solomon for the current year is $228,800, all of which is passive. Tobias owns another investment that produced $123,200 of passive activity income during the year. (Assume that Tobias is a single taxpayer, there were no distributions or changes in liabilities during the year, and the Solomon loss is Tobias's only loss for the year from any activity.) How much of Solomon's losses may Tobias deduct on his Form 1040? How much of the loss is suspended, and what Code provisions cause the suspensions? Applicable Provision Deductible Loss Suspended Loss Overall limitation $_________ $___________ At-risk limitation $__________ $___________ Passive loss limitation $_________ $____________ Therefore, Tobias can deduct $_____________ on his return in the current year.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Tobias is a 50% partner in Solomon LLC, which does not invest in real estate. On January 1, Tobias's adjusted basis for his LLC interest is $176,000, and his at-risk amount is $140,800. His share of losses from Solomon for the current year is $228,800, all of which is passive. Tobias owns another investment that produced $123,200 of passive activity income during the year. (Assume that Tobias is a single taxpayer, there were no distributions or changes in liabilities during the year, and the Solomon loss is Tobias's only loss for the year from any activity.)
How much of Solomon's losses may Tobias deduct on his Form 1040? How much of the loss is suspended, and what Code provisions cause the suspensions?
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Therefore, Tobias can deduct $_____________ on his return in the current year.
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