Suspended Losses
What would happen to suspended losses in a divorce situation? Would half of the losses go with each party for future years?
Also, what happens if you accumulate $60,000 over the years in suspended losses and you reach a year when your income was low enough to use the losses - are you able to use 25K one year and still maintain the additional 35K for future years?
I would think you would need to make it part of your divorce decree - who gets the carryforwards. Check with your divorce attorney.
In answer to your other question, the losses are suspended, until you have passive income to absorb the carryover losses or if you sell the property the losses are "freed up" and can be taken in the year of sale.
what happens if you accumulate $60,000 over the years in suspended losses and you reach a year when your income was low enough to use the losses - are you able to use 25K one year and still maintain the additional 35K for future years?
The short answer is yes.
If you have a loan in a LLC and going to a personal loan. It is impossible unless you forgive the LLC. I a sorry to tell you that now you have tied your assets. I tell investors everyday not to do this! Now your LLC is liable no mater what. Never take a bite in an apple, unless you are willing to cut the apple tree down!
When you file your 1065 you put it on line 19b of Schedule K, Distributions of other property; and in box "L" of schedule K-1, where it reduces your capital account.
Chris
It is my understanding that, as a general rule, contributions of capital assets to a business entity are done at cost basis, whereas, withdrawals of capital assets are done at FMV.
Ask your tax man and your CPA if the transfer to your personal name would be a taxable event. If the transfer is at FMV and you have an appreciated asset, then the business entity will have a taxable capital gain.
Again, I wonder why you want to take the property out of the business entity. What is the business entity not doing for you that holding in your own name will do better?[ Edited by NewKidInTown3 on Date 02/28/2008 ]