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

question 37

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 the above.

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Definitions:

Profit Center

A branch or division of a company that is directly responsible for generating its portion of the organization's overall profit.

Generates Revenue

The process or activities that result in income being brought into a company, such as sales of goods or provision of services.

Incurs Costs

To incur costs means to recognize or accumulate expenses through activities or operations, leading to a reduction in profits.

Dollar Gross Profit

The total monetary gain computed by subtracting the cost of goods sold from the sales revenue of a company.