Jeremy owns a passive activity that has a basis of $30,000 and a suspended loss of $16,000. His taxable income from active and portfolio income is $81,000. What is the effect on Jeremy's taxable income if he sells the passive activity for a. $37,000: Jeremy has a capital gain of $ This results in a net deduction of $ b. $25,000: Jeremy has a s loss. on the sale of the activity and a deduction of $16,000 for the suspended loss on the activity. capital loss on the sale of the passive activity and is allowed a deduction for the $16,000 suspended

Evelyn has rental income of $44,500 and passive income of $15,250. She also has $133,500 of losses from a real estate rental activity in which she actively participates. Evelyn’s AGI is $88,000 before considering this activity. Required: How much rental loss can she deduct against other income sources without regard to the at-risk rules? Deductible rental loss $

Jorge owns two passive investments, Activity A and Activity B. He plans to sell Activity A in the current year or next year. Juanita has offered to buy Activity A this year for an amount that would produce a taxable passive activity gain to Jorge of $115,000. However, if the sale, for whatever reason, is not made to Juanita, Jorge believes that he could find a buyer who would pay about $7,000 less than Juanita. Passive activity losses and gains generated (and expected to be generated) by Activity B follow: Two years ago ($35,000) Last year (35,000) This year (8,000) Next year (30,000) Future years Minimal profits All of Activity B's losses are suspended. Jorge is in the 32% tax bracket. If Activity A is sold next year for $7,000 less than Juanita's offer: How are the suspended losses for Activity B treated?  What is the Federal income tax related to the sale of Activity A? $_______

Patrick owns a building used in his business with an adjusted basis of $300,000 and a $875,000 FMV. He exchanges the building for a building owned by Danny. Danny​'s building has a $1,000,000 FMV but is subject to a $125,000 liability. Patrick assumes Danny​'s liability and uses the building in his business.   Read the requirements.   Requirement a. What is Patrick​'s realized​ gain?   The realized gain is   Requirement b. What is Patrick​'s recognized​ gain? ​(If there is no recognized​ gain, make sure to enter​ "0" in the appropriate​ cell.)   The recognized gain is    Requirement c. What is Patrick​'s basis for the building​ received?   Patrick's basis for the building received is

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Noah Yobs, who has $97,000 of AGI (solely from wages) before considering rental activities, has $87,300 of losses from a real estate rental activity in which he actively participates. He also actively participates in another real estate rental activity from which he has $48,500 of income. He has other passive activity income of $31,040. a.  What amount of rental loss can Noah use to offset active or portfolio income in the current year? b.  Compute Noah’s AGI on Form 1040 [pages 1 and 2; also complete Schedule 1 (Form 1040)] for the current year. Use the minus sign to indicate a loss. What amounts should go on lines 1, 6, & 7 on page 2 of FORM 1040? What amount s go on lines 17, & 22 on schedule one of FORM 1040?

aRhonda owns an office building that has an adjusted basis of $45,000. The building is subject to a mortgage of $20,000. She transfers the building to Miguel in exchange for $15,000 cash and a warehouse with an FMV of $50,000. Miguel assumes the mortgage on the building. Required: What are LaRhonda’s realized and recognized gain or loss? What is her basis in the newly acquired warehouse?