V6. Sean Grey acquired a 30% interest in Beau Grey Productions, LLC several years ago for $48,000. He does not materially participate in the business. At the beginning of 2021, Sean has a tax basis in his LLC interest of $20,000. In 2021, Beau Grey incurred a loss of $180,000 and did not make any distributions to its members. Compute the loss from Beau Grey which Sean can deduct on his return for 2021 assuming that he has rental property from which he has net income of $8,500.

SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter13: Corporations: Earning & Profits And Distributions
Section: Chapter Questions
Problem 34P
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V6. Sean Grey acquired a 30% interest in Beau Grey Productions, LLC several years ago for $48,000. He does not materially participate in the business. At the beginning of 2021, Sean has a tax basis in his LLC interest of $20,000. In 2021, Beau Grey incurred a loss of $180,000 and did not make any distributions to its members. Compute the loss from Beau Grey which Sean can deduct on his return for 2021 assuming that he has rental property from which he has net income of $8,500. 

 

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