Practical Guide to Partnerships and LLCs—Instructor’s Guide Solutions
R is a 25% general partner in Forlorn Partners. Her K-1 from the partnership reports
Net rental real estate income (loss)
Unrecaptured Sec. 1250 gain
Investment interest expense
R is not a real estate professional. She received the guaranteed payment from the
partnership for legal services provided. The Sec. 1250 gain reported by the
partnership is attributable to the partnership’s sale of one of its rental real estate
properties during the year.
Compute R’s net passive loss from Forlorn Partners.
What is her net portfolio income?
How will the guaranteed payment be classified?
Assuming R has no passive income or loss from any other source, by how much
will the information reported on this K-1 increase her taxable income?
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