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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 $236,000, and his at-risk amount is $188,800. His share of losses from Solomon for the current year is $306,800, all of which is passive. Tobias owns another investment that produced $165,200 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 $236,000, and his at-risk amount is $188,800. His share of losses from Solomon for the current year is $306,800, all of which is passive. Tobias owns another investment that produced $165,200 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.

FINANCIAL ACCOUNTING
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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< Problem 14-18 (Algorithmic) (LO. 6) 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 $236,000, and his at-risk amount is $188,800. His share of losses from Solomon for the current year is $306,800, all of which is passive. Tobias owns another investment that produced $165,200 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.
Transcribed Image Text:< Problem 14-18 (Algorithmic) (LO. 6) 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 $236,000, and his at-risk amount is $188,800. His share of losses from Solomon for the current year is $306,800, all of which is passive. Tobias owns another investment that produced $165,200 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.
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