Vic's at-risk amount in a passive activity is $200,000 at the beginning of the current year.His current loss from the activity is $80,000.Vic had no passive activity income during the year.At the end of the current year:

Question

Quizplus · Accepted Answer

At-risk amount is the amount of money an individual could lose in a business investment. Vic's at-risk amount is $200,000 at the beginning of the year. His current loss from the activity is $80,000, which means his at-risk amount is reduced to $120,000 ($200,000 - $80,000). Since Vic had no passive activity income during the year, he has a suspended passive activity loss of $80,000. Therefore, the correct choice is A.

Vic's At-Risk Amount in a Passive Activity Is $200,000 at the Beginning