ITX - 41 Flashcards
(41.1) The __ rules allow a taxpayer a deduction for losses only to the extent that the taxpayer is actually at risk for the amount lost.
at-risk
(41.1) For activities that involve holding ___, a client is at risk for the share of debt secured by the real estate if it is borrowed from an ordinary lender (bank or mortgage lender) even though no one is personally liable for the debt.
real property
(41.1) Once a loss qualifies for recognition under the at-risk rules, it may also be subject to the ___ rules.
passive activity loss
(41.1) Passive losses only offset __ income for individuals, estates, trusts, and personal service corporations.
passive
(41.1) C corporations can offset passive losses against ___, but not ___.
- business income
- portfolio income
(41.2) A ___ is one that involves the conduct of a trade or business in which the taxpayer does not materially participate.
passive activity
(41.2) Passive Activity - Sec. 469: To materially participate: The taxpayer participates more than ___ hours.
500
(41.2) Passive Activity - Sec. 469: To materially participate: The taxpayer’s participation constitutes essentially __ participation.
all
(41.2) Passive Activity - Sec. 469: To materially participate: The taxpayer participates ___ hours, but that is more than any other participant.
100
(41.2) Passive Activity - Sec. 469: To materially participate: The taxpayer materially participated in any ___ of the last ___ years.
5
10
(41.2) Passive Activity - Sec. 469: To materially participate: The activity involved providing ___.
personal services (e.g., health, accounting, performing arts)
(41.2) Passive Activity - Sec. 469: To materially participate: The taxpayer participates for ___ hours in this activity, and his or her total participation in all such activities exceeds ___ hours.
100
500
(41.2) Rental activities are always ___ activity, except for short-term rentals (hotels), rentals with significant services (hospitals), and rentals which are for nonexclusive use (golf courses).
passive
(41.2) An interest in a working oil or gas property, if held in a capacity other than a ___, is not classified as passive activity.
limited partner
(41.2) ___ are generally not considered to have materially participated in the partnership
Limited partners