Individual Income Taxes
43rd Edition
ISBN: 9780357109731
Author: Hoffman
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Question
Chapter 11, Problem 38P
To determine
Identify the amount that Person K might deduct in the year 2018 and 2019.
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In 2020, Fred invested $155,000 in a general partnership. Fred's interest is not considered to be a passive activity. If his share of the partnership losses is $108,500 in 2020 and $75,950 in 2021, how much can he deduct in each year?
Fred can deduct $fill in the blank 1 in 2020 and $fill in the blank 2 in 2021.
In 2020, Fred invested $50,000 in a general partnership. Fred's interest is not considered to be a passive activity. If his share of the
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X in 2021 and $
X in 2022.
The at-risk rules limit the deductibility of losses from business and income-producing activities.
Chapter 11 Solutions
Individual Income Taxes
Ch. 11 - Prob. 1DQCh. 11 - List some events that increase or decrease an...Ch. 11 - Roberto invested 18,000 in a chicken production...Ch. 11 - Prob. 4DQCh. 11 - Carlos owns an interest in an activity that...Ch. 11 - Kim owns an interest in an activity that produces...Ch. 11 - Prob. 7DQCh. 11 - Prob. 8DQCh. 11 - LO.3 Bronze Corporation has 100,000 of active...Ch. 11 - LO.4 Discuss what constitutes a passive activity.
Ch. 11 - Prob. 11DQCh. 11 - LO.5 How many hours must a participant work in a...Ch. 11 - LO.5 Suzanne owns interests in a bagel shop, a...Ch. 11 - Prob. 14DQCh. 11 - Prob. 15DQCh. 11 - LO.5 Some types of work are counted in applying...Ch. 11 - LO.5 Last year Alans accountant informed him that...Ch. 11 - Prob. 18DQCh. 11 - Prob. 19DQCh. 11 - Prob. 20DQCh. 11 - What is a real estate professional? Why could...Ch. 11 - Prob. 22DQCh. 11 - LO.8 Since his college days, Charles has developed...Ch. 11 - LO.8 Brad owns a small townhouse complex that...Ch. 11 - Prob. 25DQCh. 11 - Prob. 26DQCh. 11 - LO.2 In the current year, Ed invests 30,000 in an...Ch. 11 - Prob. 28CECh. 11 - Prob. 29CECh. 11 - LO.7 Rhonda has an adjusted basis and an at-risk...Ch. 11 - LO.8 Noah Yobs, who has 62,000 of AGI (solely from...Ch. 11 - LO.9 Rose dies with passive activity property...Ch. 11 - Prob. 33CECh. 11 - Prob. 34PCh. 11 - LO.2 In the current year, Bill Parker (54 Oak...Ch. 11 - LO.2, 11 Heather wants to invest 40,000 in a...Ch. 11 - LO.1, 3 Dorothy acquired a 100% interest in two...Ch. 11 - Prob. 38PCh. 11 - Prob. 39PCh. 11 - LO.3, 11 Emily has 100,000 that she wants to...Ch. 11 - LO.3 Seojun acquired an activity several years...Ch. 11 - LO.3, 11 Jorge owns two passive investments,...Ch. 11 - LO.3 Sarah has investments in four passive...Ch. 11 - LO.3 Leon sells his interest in a passive activity...Ch. 11 - LO.3 Ash, Inc., a closely held personal service...Ch. 11 - Prob. 46PCh. 11 - LO.2, 3, 7, 11 Kristin Graf (123 Baskerville Mill...Ch. 11 - LO.2, 3, 7, 11 The end of the year is approaching,...Ch. 11 - Prob. 49PCh. 11 - Grace acquired an activity four years ago. The...Ch. 11 - Prob. 51PCh. 11 - LO.2, 3, 7 Five years ago Gerald invested 150,000...Ch. 11 - LO.3, 8 Several years ago Benny Jackson (125 Hill...Ch. 11 - Prob. 54PCh. 11 - Prob. 55PCh. 11 - Prob. 56PCh. 11 - Prob. 57PCh. 11 - Prob. 58PCh. 11 - LO.8 Jiu has 105,000 of losses from a real estate...Ch. 11 - Prob. 60PCh. 11 - LO.9 In the current year, Abe gives an interest in...Ch. 11 - Prob. 62PCh. 11 - Prob. 63PCh. 11 - Prob. 64PCh. 11 - Carol is a successful physician who owns 100% of...Ch. 11 - Prob. 2RPCh. 11 - Prob. 3RPCh. 11 - Prob. 4RPCh. 11 - Which of the following statements regarding...Ch. 11 - Michael owns a rental house that generated a...Ch. 11 - Prob. 3CPACh. 11 - Prob. 4CPACh. 11 - Sally recently invested 10,000 (tax basis) in a...
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Similar questions
- LO.2 In the current year, Ed invests 30,000 in an oil partnership. He has taxable income for the current year of 2,000 from the oil partnership and withdraws 10,000. What is Eds at-risk amount at the end of the year?arrow_forwardNell and Kirby are in the process of negotiating their divorce agreement, to be finalized in 2019. What should be the tax consequences to Nell and Kirby if the following, considered individually, became part of the agreement? a. In consideration for her one-half interest in their personal residence. Kirby will transfer to Nell stock with a value of 200,000 and 50,000 of cash. Kirbys cost of the stock was 150,000, and the value of the personal residence is 500,000. They purchased the residence three years ago for 300,000. b. Nell will receive 1,000 per month for 120 months. If she dies before receiving all 120 payments, the remaining payments will be made to her estate. c. Nell is to have custody of their 12-year-old son. Bobby. She is to receive 1,200 per month until Bobby (1) dies or (2) attains age 21 (whichever occurs first). After either of these events occurs, Nell will receive only 300 per month for the remainder of her life.arrow_forwardJake pays the following amounts to his former spouse during the current year: What amount can Jake deduct as alimony for the current year? Assume that the divorce occurred before 2019. a. 0 b. 12,000 c. 22,000 d. 137,000arrow_forward
- LO.3 Sarah has investments in four passive activity partnerships purchased several years ago. Last year the income and losses were as follows: In the current year, she sold her interest in Activity D for a 10,000 gain. Activity D, which had been profitable until last year, had a current loss of 1,500. How will the sale of Activity D affect Sarahs taxable income in the current year?arrow_forward1. In 2020, Joanne invested $90,000 for a 20% interest in a partnership in which she is a material participant. The partnership reported losses of $340,000 in 2020 and $180,000 in 2021. Joanne’s share of the partnership losses was $68,000 in 2020 and $36,000 in 2021. How much of these losses can Joanne deduct on her tax return? $0 in 2020; $0 in 2021. $68,000 in 2020; $22,000 in 2021. $68,000 in 2020; $36,000 in 2021. $68,000 in 2020; $0 in 2021.arrow_forwardThis answer is wrong . please give me the right answer.arrow_forward
- could you please show me the steps for how to calculate Lucy's total gain and her current deductible loss.arrow_forwardIn 2018, Kirk invested $50,000 in a general partnership in which he materially participates (passive activity loss limits do not apply). The business incurs a first-year loss in 2018, and Kirk’s share of the business’ deductible loss was $27,000. What amount of the $27,000 loss is allowed under the at-risk rules in 2018? Enter the allowed loss amount as a positive number.arrow_forwardIn 2021, Lena invests $30,000 for a 20% limited partnership interest in an activity in which she is NOT a material participant. Lena's share of the partnership losses is $40,000 in 2021. Her income consists of income from her medical practice in the amount of $250,000 and $4,000 from another passive activity. (a) How much loss from the activity is allowable under the at-risk rules? (b) How much loss from the activity is deductible under the passive loss rules?arrow_forward
- In 2021, Lena invests $30,000 for a 20% limited partnership interest in an activity in which she is NOT a material participant. Lena's share of the partnership losses is $40,000 in 2021. Her income consists of income from her medical practice in the amount of $250,000 and $4,000 from another passive activity.(a) How much loss from the activity is allowable under the at-risk rules? (b) How much loss from the activity isarrow_forwardN25. Several years ago, Jacky purchased a 20% interest in ZZZ Partnership for $60,000. The partnership is her sole investment. Jacky’s amount at risk in the partnership interest was $120,000 at the end of 2018. ZZZ incurred a loss of $400,000 in 2018 and reported income of $200,000 in 2019. Assuming Jacky is not a material participant in ZZZ, how much of her loss from ZZZ Partnership is deductible in 2019 and 2020, respectively?arrow_forwardLucy sells her partnership interest, a passive activity, with an adjusted basis of $362,500 for $398,750. In addition, she has current and suspended losses of $54,375 associated with the partnership and has no other passive activities. a. Calculate Lucy's total gain and her current deductible loss.Her total gain is_______and her deductible loss is_______. b. What type of income can the deductible loss offset?Lucy's deductible loss is offset against________arrow_forward
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