The basis limitation rules are applied before the at-risk and passive loss limitation rules.

Name: The basis limitation rules are applied before the at-risk and passive loss limitation rules.
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The basis limitation rules determine the maximum amount of loss and deduction a taxpayer can claim from a partnership or S corporation, and these rules are applied before the at-risk and passive loss limitation rules, which further limit the losses a taxpayer can deduct.

The Basis Limitation Rules Are Applied Before the At-Risk and Passive