Walter, a single taxpayer, purchased a limited partnership interest in a tax shelter in 1990. He also

Question:

Walter, a single taxpayer, purchased a limited interest in a tax shelter in 1990. He also acquired a rental house in 2016, which he actively manages. During 2016, Walter's share of the partnership's losses was $30,000, and his rental house generated $20,000 in losses. Walter's modified adjusted gross income before passive losses is $125,000.
a. Calculate the amount of Walter's allowable deduction for rental house activities for 2016.
b. Calculate the amount of Walter's allowable deduction for the losses for 2016.
c. What may be done with the unused losses, if anything?
Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...