Passive Loss and At-Risk Rules (Mini) 2021

  • Credits: 3
  • Format: Self-Study eBook
  • Field of Study: Federal Tax Law
  • Author/Speaker: Danny Santucci, CPA
Course ID: Advanced Preparation: Experience Level:
EWTFM-T-01780-21-S | 6233-CE-0500 None Overview
Published Date: Program Prerequisites: Other Course Formats:
© February 2021 General Understanding of Federal Income Taxes Self-Study eBook

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 §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 §469, with emphasis on tax savings ideas. Participants will learn to master the proper administration of these complex and often cumbersome provisions.

Topics include:
  • 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 course material, you will be able to:

  1. Identify affected taxpayers, categories of income and loss, and passive losses under §469 and necessary §469 calculation steps and specify the §469 & §1211 limits and the ordering and suspension of any disallowed losses.
  2. Recognize a taxpayer’s material participation in an activity by:
    • Identifying the material participation tests and their application to entities such as partnerships and corporations;
    • Specifying the activity grouping rules and exempt activities;
    • Determining passive activity particularly, the treatment of rental activity as passive; and
    • Identifying “nested” activities.
  3. Identify special passive loss rules and calculations by:
    • Determining alternating use affects on the amount realized and adjusted basis and citing additional loss limitations outside of §469;
    • Recognizing requirements for the special $25,000 allowance; and
    • Specifying recharacterization rules and their purpose.
  4. Recognize the passive activity audit guidelines identifying audit issues, determine the real estate rental activity credit exception, and cite the at-risk limit rules as they relate to §469. After studying the materials, answer the exam questions 1 to 15.

Who Should Attend:
  • All Certified Public Accountants (CPAs)
  • Enrolled Agents (EAs)
  • Tax Return Preparers (TRPs)

Qualifies and Approved with all State Boards of Accountancy and the following sponsorship’s: