Which of the Following Decreases a Taxpayer's At-Risk Amount

question 17

Multiple Choice

Which of the following decreases a taxpayer's at-risk amount?

• A)Cash and the adjusted basis of property contributed to the activity.
• B)Amounts borrowed for use in the activity for which the taxpayer is personally liable or has pledged as security property not used in the activity.
• C)Taxpayer's share of amounts borrowed for use in the activity that is qualified nonrecourse financing.
• D)Taxpayer's share of the activity's income.
• E)None of these.

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Definitions:

Contractual Liability

The legal obligation arising from a contract that requires a party to compensate for any losses or damages incurred.

Competent and Professional

Refers to possessing the required skills, knowledge, and ethical standards expected in a professional setting.

Third Party Intended Beneficiary

A person or entity that, while not a party to a contract, is intended by the contracting parties to benefit from its performance.

Academic Performance

An assessment of a student's learning progress and achievement in educational settings, often measured by grades and test scores.