Tom Wilson, a single taxpayer, is employed full-time as an engineer at ALT Technologies Inc. Tom and his brother, Bob, recently started their own business manufacturing and selling specialized tools that Tom has developed, and which Tom works on in the evenings and on weekends. Tom and Bob are equal general partners in the business, BTW Tools, and both are actively involved in managing and operating the business. The new business is currently operating at a substantial loss due to initial investments in necessary equipment and machinery and other costs, but Bob is involved in contract negotiations with several potential customers that he believes will bring in significant future business. Tom also has a 5 percent limited partnership interest in Oceanview Development Partners, a real estate development partnership. Tom has sufficient tax basis and at-risk basis in his partnership interests to flow through any losses, and does not take any distributions.

Tom has provided documentation for his 20XX gross income in the exhibits above. Using the information provided in the exhibits, enter the appropriate amount for each item identified in the table below. Enter income and gains as positive whole numbers and losses as negative whole numbers. If a value is zero, enter a zero (0).

1. Total income included in calculating Tom's 20xx taxable gross income? 

2. Total losses deducted in calculating Tom's 20xx taxable gross income? 

3. Disallowed 20xx passive activity loss carried forward?

4. Disallowed 20xx excess business loss carried forward? 

Answer rating: 100% (QA)

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