Ans: (B) $ 50,000
Explanation:
1) Kali's at-risk amount before the current year's allocation is :
=$200,000 contribution + $200,000 income - $300,000 in losses
= $100,000 at risk.
2 ) The business allocated a $150,000 loss to Kali for the current year.
3) Therefore, she will be able to utilize $100,000 of the current year's loss against her remaining basis ($150,000) and $50,000 will be suspended due to at-risk rules.
4) Suspended loss due to at risk levels:
= $150,000 - $ 100,000
= $ 50,000
4. Kali is a 20 percent owner in CheerSquad, LLC, a local gym for middle school...
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