Question

Molly Grey (single) acquired a 30 percent limited partnership interest in Beau Geste LLP several years ago for $49,000. At the beginning of year 1, Molly has tax basis and an at-risk amount of $30,500. In year 1, Beau Geste incurs a loss of $228,000 and does not make any distributions to the partners. In year 1, Molly's AGI (excluding any income or loss from Beau Geste) is $79,400. This includes $12,000 of passive income from other passive activities. In year 2, Beau Geste earns income of $30,500. In addition, Molly contributes an additional $33,850 to Beau Geste during year 2. Molly's AGI in year 2 is $85,100 (excluding any income or loss from Beau Geste). Thi:s amount includes $8,760 in income from her other passive investments b. Based on the above information, complete the following table: Complete this question by entering your answers in the tabs below. Req B2 Req B1 What are the cumulative total passive suspended losses at the end of year 2? Cumulative total passive suspended losses Req B1 Req B2 >

Answer 1

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Answer is highlighted in yellow: Solution: b)1 Share of Passive loss in year 1 (228000*30%) $ 68,400 $ 12,000 Less: Passive Income from other activities Suspended loss in Year1 Less: Share of Passive Income from Beau Geste in year 2 56,400 $ (30500*30%) $ 9,150 Less: Passive Income from other activities 8,760 38,490 Cummulative total passive suspended losses