Discussion:Passive losses of deceased client

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Discussion Forum Index --> Basic Tax Questions --> Passive losses of deceased client


Discussion Forum Index --> Tax Questions --> Passive losses of deceased client

Ztom (talk|edits) said:

18 November 2011
Have client who died. He had passive losses from rentals and k1's that were prior years and became suspended losses. I dont know what to do with them, do they go on his final or 1041 ect? help

Kevinh5 (talk|edits) said:

18 November 2011
Reduce suspended losses by any §1014 step-up in basis in the passive activity property (§469(g)(2)) [which therefore includes the K-1 activity/property], then take the balance of suspended losses (if any) on the decedent's final return to offset non-passive income. There is no carryover to the 1041 or to beneficiaries.


Thus, you've got to know the FMV of each property as of date of death (DOD).


This would be a great queston for the Special Enrollment Examination given to prospective EAs.

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