Five years ago Gerald invested $150,000 in a passive activity,

Five years ago Gerald invested $150,000 in a passive activity, his sole investment venture. On January 1, 2017, his amount al risk in the activity was $30,000. His shares of the income and losses were as follows:

Year                         Income (Loss)
2017..............................($40,000)
2018............................... (30,000)
2019................................. 50,000

Gerald holds no suspended at-risk or passive activity losses at die beginning of 2017. How much can Gerald deduct in 2017 and 2018? What is his taxable income from the activity in 2019? Consider the at-risk rules as well as the passive activity loss rules.

Members

  • Access to 2 Million+ Textbook solutions
  • Ask any question from 24/7 available
    Tutors
$9.99
VIEW SOLUTION

OR

Non-Members

Get help from Business Tutors
Ask questions directly from Qualified Online Business Tutors .
Best for online homework assistance.