近距离内射合集

Let鈥檚 start a business. Being well organized, we鈥檒l need a checklist of things to do. Maybe we should add a list of things not to do.

The first thing to do is to make money. Generate profits. Produce value-enhancing activities.

Next, tops on the list is: Do not lose money. Such a thing would be anathema to our business model.

Hold on a second. Perhaps it is not so bad to produce losses. For one thing, we could avoid paying taxes.

And what if our losses were due to taking advantage of the generous allowances that Congress provides for purchasing business property?

That is, if we reinvest our cash flow in building a bigger mousetrap, perhaps the tax deductions would have us show a loss.

And if we want a big mousetrap, one that could 鈥済o public,鈥� maybe the stock market would not care if we showed persistent losses.

The women in my family check Pinterest for ideas for a variety of things that the women in my family seem to like to do.

Pinterest was one of the well-known public companies that has never made a profit. No one seems to care.

Lyft was another big loser. Amazon too. All three of these companies are now making a profit. Amazon is making big profits.

Real estate investments follow this same pattern. Losses early due to the generous tax write-offs available. Profits, we hope, later when the properties are sold.

The tax twist to this is 鈥� how do we benefit from those early losses? About six of seven businesses are 鈥減assthroughs鈥� for tax reporting.

This means that the losses (and profits) pass through to the investors. Those investors would like to get a current tax benefit for the losses.

There are four hurdles that the tax law throws up between the reported losses and the investors鈥� tax returns.

First, the investor must have 鈥渂asis鈥� in his investment. This can include invested funds and, if the business is a partnership, borrowed money.

Second, the investor must have an 鈥渁t-risk basis鈥� in his investment. If the business is a partnership, there are two differences between the basis and the at-risk basis.

The first difference is that borrowed money is part of an at-risk basis only if the investor may suffer losses if the investment goes bad.

This means that 鈥渘onrecourse鈥� debt is not part of the basis. Nonrecourse means that no investor will suffer a loss if the partnership is unable to pay.

The second difference is that the at-risk basis is determined for each 鈥渁ctivity鈥� the partnership conducts. The regular basis is aggregated for all activities.

Even if there is no nonrecourse debt, the at-risk basis can be a more difficult hurdle because the total basis must be apportioned among the various activities.

The third hurdle is the 鈥減assive loss鈥� limit. This is the most challenging hurdle to clear, and many investors ignore the first two hurdles to focus on this one.

You cannot ignore the first two hurdles. The passive loss hurdle requires that the investor 鈥渕aterially participate鈥� in the loss-generating activity.

This hurdle also requires segregating the loss by activity, although the definition of an activity is different than the at-risk hurdle.

Also, rental activities, which really mean real estate rentals, are automatically considered passive.

Well, they used to be automatically passive when the rules were introduced in 1986. Seven years later, an exception was created for so-called 鈥渞eal estate professionals.鈥�

Real estate professionals are people who spend more than half of their time on real estate stuff, plus they spend more than 750 total hours on real estate stuff.

A real estate professional simply ignores the rule that rentals are automatically passive. They still must materially participate in the real estate rental activity.

These three hurdles, which progressively get harder to clear, might make one think that Congress really doesn鈥檛 want an investor to claim tax losses.

Hold on, you say, didn鈥檛 this column say there were four hurdles? I can鈥檛 slip one by your keen eye.

Over 30 years after establishing the first three hurdles, Congress said that even if you pass those tests, you can鈥檛 claim 鈥渢oo much鈥� loss in one year.

What鈥檚 too much? More than $250,000 for most people, or $500,000 if you are married and filing a joint return.

So, while there are some benefits to reporting tax losses, the full benefit sometimes takes patience.

Jim Hamill is the director of tax practice at Reynolds, Hix & Co. in Albuquerque. He can be reached at jimhamill@rhcocpa.com.