Passive Losses

Course Description:

This course addresses the practical aspects of §469 and the needed skill to handle pragmatic issues. Fundamentals are reviewed, planning opportunities identified, creative strategies discussed and evaluated along with remaining traditional approaches. The goal of this instructive book is to understand and solve problems under §469, with emphasis on tax savings ideas. Readers will learn to master the proper administration of this complex and often cumbersome provision.

Learning Objectives:

Upon successful completion of this course, participants will be able to:

• Explain the broad impact of the §469 limitation provision.
• Describe the mechanics of the passive loss rules.
• Apply §469 to appropriate deductions.
• Identify what type of income may be offset by passive losses.
• Explain the suspension of disallowed losses.
• Identify two ways to ultimately “free up” passive losses.
• Describe the treatment of passive credits including potential basic adjustments.
• Define a fully taxable disposition indicating the impact of related party transactions.
• Determine which clients are or are not subject to the passive loss rules.