I have a k-1 that in part L shows a net income loss in excess of box 1 loss of $80,000.00 - this loss was attached to a lawsuit by the partnership. The question becomes: can this loss be deducted? The partner has both basis & is a managing partner. Second question on the k-1 , box 13 code ZZ. There are legal fees of $78,000.00 - are these also deductible? thank you!