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#1
04-02-2005, 07:36 AM
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 Re: Allowable 1120S K-1 Losses? "Ken B. Winger" <kbwing[at]comcast.net> wrote: - quote - > 1st Yr 2004 1120S, 2 S/H's, Husband & Wife, owned 50% each,
Why is the husband not at risk? Total loss is $10k, of> Wife's materially participates where husband spent less than > the required 500hrs. > Total loss: 10k > Husband S/H and Loan Basis - $5k > Wife - same > Based on the above facts: > Q1: Would not the deductible loss be only $5k since husband > is not at risk? which $5k is his. - quote - > Q2: If correct on Q1, then would not the only way to take
1 isn't correct. You're also mistaken on the passive> the disallowed loss is either by disposal of business or > husband materially participates in business? activity rules, as both spouses are material as long as one is. -- David M. Woods, EA, ChFC, CLU Woods Financial Services Norwood, MA 02062 www.woods-financial.com << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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04-02-2005, 07:17 AM
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| Re: Allowable 1120S K-1 Losses? Ken B. Winger wrote: - quote - > 1st Yr 2004 1120S, 2 S/H's, Husband & Wife, owned 50% each,
Ah yes! Just as I thought (see above)> Wife's materially participates where husband spent less than > the required 500hrs. - quote - > Total loss: 10k
Well, I've a client with exact same situation, 50/50, but> Husband S/H and Loan Basis - $5k > Wife - same > Based on the above facts: > Q1: Would not the deductible loss be only $5k since husband > is not at risk? > Q2: If correct on Q1, then would not the only way to take > the disallowed loss is either by disposal of business or > husband materially participates in business? spouse (wife) doesn't participate. So you're saying on the basis of stock ownership, the husband is allowed no share of the loss? ChEAr$, Harlan Lunsford, EA n LA 1 Apr 2005 << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#-1
04-01-2005, 06:49 AM
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| Allowable 1120S K-1 Losses? 1st Yr 2004 1120S, 2 S/H's, Husband & Wife, owned 50% each, Wife's materially participates where husband spent less than the required 500hrs. Total loss: 10k Husband S/H and Loan Basis - $5k Wife - same Based on the above facts: Q1: Would not the deductible loss be only $5k since husband is not at risk? Q2: If correct on Q1, then would not the only way to take the disallowed loss is either by disposal of business or husband materially participates in business? << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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| 1120s, allowable, losses |
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