For the tax year, OSH partnership reported a $74,000 ordinary loss and a $28,000 increase in recourse liabilities for which the partners are liable. Ashley, a 50% partner, had an adjusted basis of $15,000 at the beginning of the year. What is Ashley's allowable loss and her adjusted basis in OSH at the end of the year?

Question

Marco Mccullough

Business

14 February, 16:02

For the tax year, OSH partnership reported a $74,000 ordinary loss and a $28,000 increase in recourse liabilities for which the partners are liable. Ashley, a 50% partner, had an adjusted basis of $15,000 at the beginning of the year. What is Ashley's allowable loss and her adjusted basis in OSH at the end of the year?

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Jakayla Santos · Answer 1

Ashley's Allowable loss $15000, Adjusted Basis $0

Explanation:

Ashley's Share of loss = $74000 x 50% i. e. $37000

But since Ashley has adjusted basis of only $15000, therefore only $15000 loss can be adjusted and remaining will be adjusted in future years.

Therefore, Ashley's Allowable loss $15000, Adjusted Basis $0