#Scenario $10$: Thomas is a $25\%$ partner

in a partnership. The partnership incurred a

net loss of $$180,000$ for the year, and Thomas's

share of the loss is $$45,000.$ Thomas's initial

basis in the partnership was $$60,000.$ He

received a $$20,000$ cash distribution from the

partnership. Thomas's other income includes:

Wages: $$95,000$ Interest and Dividend Income:

$$2,000$ Itemized Deductions: $$22,500$

Allowable deduction for self$-$employment tax:

None How much of the partnership loss can

Thomas deduct considering his basis, the at $-$

risk limitations$,$ and passive activity loss rules?

How does the distribution affect his basis?

Calculate Thomas's Adjusted Gross Income $($

AGI$).$ What is Thomas's Taxable Income?

$?$

at

is Thomas's Total$$Tax$$Liability$?$

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