The STU Partnership is involved in leasing heavy equipment under long-term leases of five years or more.Simone has an adjusted basis for her partnership interest on January 1 of the current year of $140,000,consisting of the following:

During the year,the partnership has an operating loss of $450,000 and distributes $30,000 of cash to Simone.Partnership liabilities were the same at the end of the tax year,and the nonrecourse debt is not "qualified nonrecourse debt." If she owns a 1/3 share of partnership profits,capital,and losses,and is a material participant in the partnership,how much of her share of the operating loss can Simone deduct? What Code provisions could cause a suspension of the loss?

Question

The STU Partnership is involved in leasing heavy equipment under long-term leases of five years or more.Simone has an adjusted basis for her partnership interest on January 1 of the current year of $140,000,consisting of the following:
  
During the year,the partnership has an operating loss of $450,000 and distributes $30,000 of cash to Simone.Partnership liabilities were the same at the end of the tax year,and the nonrecourse debt is not "qualified nonrecourse debt." If she owns a 1/3 share of partnership profits,capital,and losses,and is a material participant in the partnership,how much of her share of the operating loss can Simone deduct? What Code provisions could cause a suspension of the loss?

Quizplus · Accepted Answer

The Answer of The STU Partnership is involved in leasing heavy equipment under long-term leases of five years or more.Simone has an adjusted basis for her partnership interest on January 1 of the current year of $140,000,consisting of the following:
  
During the year,the partnership has an operating loss of $450,000 and distributes $30,000 of cash to Simone.Partnership liabilities were the same at the end of the tax year,and the nonrecourse debt is not "qualified nonrecourse debt." If she owns a 1/3 share of partnership profits,capital,and losses,and is a material participant in the partnership,how much of her share of the operating loss can Simone deduct? What Code provisions could cause a suspension of the loss?

The STU Partnership Is Involved in Leasing Heavy Equipment Under