Mannarino acquired a passive activity in January of 2013. His at-risk basis at t
ID: 2600165 • Letter: M
Question
Mannarino acquired a passive activity in January of 2013. His at-risk basis at the beginning of 2015 was $65,000. This is the only passive activity that Mannarino owns. Mannarino's share of income and loss from the activity is as follows:
2015 <$95,000>
2016 55,000
Complete the following tables.
AT RISK RULES ONLY
FOR 2015
Deductible under at-risk provisions ____________________
Adjusted basis at 12/31/15 ____________________
Suspended under at-risk provisions ____________________
FOR 2016
Deductible under at-risk provisions ____________________
Adjusted basis at 12/31/16 ____________________
Suspended under at-risk provisions ____________________
PASSIVE RULES ONLY
FOR 2015
Deductible under passive loss provisions ____________________
Suspended under passive loss provisions ____________________
FOR 2016
Deductible under passive loss provisions ____________________
Suspended under passive loss provisions ____________________
Explanation / Answer
AT RISK RULES ONLY
FOR 2015
Deductible under at-risk provisions $ 65000 (out of loss of $95000: limited to the at risk basis)
Adjusted basis at 12/31/15 $0
Suspended under at-risk provisions $ 30000 ($95000-$65000)
FOR 2016
Deductible under at-risk provisions $ 30000
Adjusted basis at 12/31/16 $ 25000 ($55000-$30000)
Suspended under at-risk provisions $ 0
PASSIVE RULES ONLY
FOR 2015
Deductible under passive loss provisions $ 0(assuming that $65000 is onky at risk basis investment)
Suspended under passive loss provisions $ 95000
FOR 2016
Deductible under passive loss provisions $ 55000 (limited to the income from passive activity)
Suspended under passive loss provisions $ 30000 ($95000 - $55000)
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