Alfonso began the year with a tax basis in his partnership interest of $28,000. His share of partnership debt at the beginning and end of the year consists of $6,000 of recourse debt and $8,000 of nonrecourse debt. During the year, he was allocated $45,000 of partnership ordinary business loss. Alfonso does not materially participate in this partnership, and he has $4,000 of passive income from other sources. How much of Alfonso’s loss is limited by the passive activity loss rules?
Alfonso began the year with a tax basis in his partnership interest of $28,000. His share of partnership debt at the beginning and end of the year consists of $6,000 of recourse debt and $8,000 of nonrecourse debt. During the year, he was allocated $45,000 of partnership ordinary business loss. Alfonso does not materially participate in this partnership, and he has $4,000 of passive income from other sources. How much of Alfonso’s loss is limited by the passive activity loss rules?
Chapter11: Invest Or Losses
Section: Chapter Questions
Problem 38P
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Alfonso began the year with a tax basis in his
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