E-Passive Loss & At-Risk Rules

E-Passive Loss & At-Risk Rules
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Price: $19.99
Credits: 2
Prerequisite: None
Level: Overview
Model: MT030
Author: Danny Santucci
Average Rating: Not Rated
Fields of study: Taxes
Format: PDF

With the adoption of the passive loss limitation rules, taxpayers are looking to CPAs for guidance related to what deductions are allowed, disallowed, or suspended. Updating practitioners on the practical aspects of Statute 469, this course addresses the needed skill to handle these pragmatic issues. Fundamentals are reviewed, planning opportunities are identified, and creative strategies are discussed and evaluated along with remaining traditional approaches. The goal of this instructive course is to understand and solve client problems under Statute 469, with emphasis on tax savings ideas. Participants will learn to master the proper administration of these complex and often cumbersome provisions.


Learning Assignment & Objectives

As a result of studying the assigned materials, you should be able to meet the objectives listed below.


At the start of the materials, participants should identify the following topics for study:

  • Passive loss rules
  • Material participation
  • Activity definition
  • Passive & nonpassive activities
  • Passive activity loss
  • Rental activities
  • Recharacterization of passive income
  • Passive activity credits
  • Passive activity audit guide
  • At-risk limits

Learning Objectives

After reading the materials, participants will be able to:

  1. Determine affected taxpayers and calculate passive losses by categorizing income and loss, listing necessary calculation steps, applying the Statute 469 & Statute 1211 limits, and explaining the ordering and suspension of any disallowed losses.
  2. Determine a taxpayer’s material participation in an activity by:
    Listing several material participation tests and demonstrating their application to entities such as partnerships and corporations;
    Explaining the activity grouping rules noting exempt activities;
    Defining passive activity particularly, the treatment of rental activity as passive; and
    Locating “nested” activities.
  3. Identify and apply special passive loss rules and calculations by:
    Illustrating alternating use affects on amount realized and adjusted basis and listing additional loss limitations outside of Statute 469;
    . Listing five requirements for the special $25,000 allowance; and
    . Describing recharacterization rules and their purpose.
  4. Explain the passive activity audit guidelines identifying audit issues, apply the real estate rental activity credit exception, and clarify the at-risk limit rules as they relate to Statute 469.

Additional Contents : Complete, no additional material needed
Advance Preparation : None
Intended Participants :
Any CPA looking to maintain or enhance their professional competence

Course Declaration : Participants must complete the final examination within one year of purchase. A minimum passing grade of 70% or better is required to receive CPE
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