Molly Grey (single) acquired a 30 percent limited partnership interest in Beau Geste LLP several years ago for $48,000. At the beginning of year 1, Molly has tax basis and an at-risk amount of $20,000. In year 1, Beau Geste incurs a loss of $180,000 and does not make any distributions to the partners. In year 1, Molly's AGI (excluding any income or loss from Beau Geste) is $60,000. This includes $10,000 of passive income from other passive activities.
In year 2, Beau Geste earns income of $30,000. In addition, Molly contributes an additional $30,000 to Beau Geste during year 2. Molly's AGI in year 2 is $63,000 (excluding any income or loss from Beau Geste). This amount includes $8,000 in income from her other passive investments.
a. Based on the above information, complete the following table:
Req A1
Req A2
Req A3
Based on the above information, complete the following table: (Leave no answers blank. Enter zero if applicable.)
At-Risk Amount:
Initial year 1 amount: $20,000
Allowed loss: (20,000)
End of year 1 at-risk amount $0
Contribution for year 2 $30,000
BG Income 9,000
Allowed loss: (34,000)
End of year 2 at-risk amount $5,000
Req A1
Req A2
Req A3
Based on the above information, complete the following table: (Leave no answers blank. Enter zero if applicable.)
Year Total Loss At-Risk Allowed At-Risk Disallowed
1 $54,000 $20,000 $34,000
2 34,000 $34,000 $0
Req A1
Req A2
Req A3
Based on the above information, complete the following table:
Year At-Risk Allowed Passive Activity Loss Allowed Passive Activity Loss Disallowed
1 $20,000 $10,000 $10,000
2 $10,000 17,000 $27,000
Req B1
Req B2
What are the cumulative total passive suspended losses at the end of year 2?
Cumulative total passive suspended losses
Req B1
Req B2
Based on the above information, complete the following table:
Year 2 AGI:
AGI before Beau Geste: $65,700
Year 2 passive income from Beau Geste 10,950
Year 2 allowed passive losses 26,360
Year 2 AGI $50,290