At Risk

[Earl]

Partnership with rental building only and receiving rents from their S Corp for this business building.

Purchased with non-recourse loan. Building stands as collateral for loan.

Partnership has loss this year. Is this at risk loss or not at risk?.

[BHoffman]

Partnership with rental building only and receiving rents from their S Corp for this business building.

Purchased with non-recourse loan. Building stands as collateral for loan.

Partnership has loss this year. Is this at risk loss or not at risk?.

Hi Earl - you might want to check out the Self Rental Rule on pg. 7-11 of TTB.

[Nashville]

Not At Risk

Self-Rental Rule notwithstanding, I do believe the parties are still at risk.

If there is a problem with the self-rental rule, this does not by itself constitute a problem with risk.

[Gretel]

The $25,000 special loss for active participation still applies. All the self-rental rule basically does is to prohibit income from the rental activity to be used against other passive losses. So if loss, and qualified for special loss, up to $25,000 is still allowed.

see also post in March 2009