Instructions For Form 8582-Cr - Passive Activity Credit Limitations - Internal Revenue Service - Page 10
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must include those credits on lines 3a
amount from line 5 on line 37 and
The tuition and fees deduction.
through 3c. If you held an indirect
report the credits on the forms
interest in the property through a
normally used. Do not complete
Include in modified adjusted gross
partnership, S corporation, or other
Worksheets 5 through 9.
income any portfolio income and
pass-through entity, use lines 3a
expenses that are clearly and directly
through 3c only if you also acquired
allocable to portfolio income. Also
your interest in the pass-through
Part II—Special
include any income that is treated as
entity after 1989. Use Worksheet 3 to
nonpassive income, such as overall
figure the amounts to enter on lines
Allowance for Rental
gain from a PTP and net income from
3a and 3b.
Real Estate Activities
an activity or item of property subject
to the recharacterization of passive
With Active Participation
Include the credits in
income rules. For information on
!
Worksheet 4, but not in
recharacterization of income, see
Worksheet 2 or 3, if you are
CAUTION
Married persons filing
Pub. 925 or Temporary Regulations
married filing a separate return and
!
separate returns who lived
section 1.469-2T(f).
lived with your spouse at any time
with their spouses at any time
CAUTION
during the year.
during the year are not eligible to
When figuring modified adjusted
complete Part II.
Lines 4a through 4c. Individuals
gross income, any overall loss from
must include on lines 4a through 4c
an entire disposition of an interest in
Use Part II to figure the credit
credits from passive activities that
a passive activity is taken into
allowed if you have any credits from
were not entered on Worksheets 1, 2,
account as a nonpassive loss if you
rental real estate activities in which
or 3. Trusts must include credits from
do not have any net passive income
you actively participated (other than
all passive activities in Worksheet 4.
after combining net income and
rehabilitation credits and low-income
Use Worksheet 4 to figure the
losses from all other passive activities
housing credits). See Rental Activities
amounts to enter on lines 4a and 4b.
(that is, Form 8582, line 4 is a loss or
beginning on page 1 for details.
zero). If you do have net passive
Line 6. If Form 8582, line 4, shows
income when you combine the net
Line 9. Married persons filing
net income or you did not complete
losses and net income from all other
separate returns who lived apart from
Form 8582 because you had net
passive activities, the overall loss
their spouses at all times during the
passive income, you must figure the
from the disposition is taken into
year must enter $75,000 on line 9
tax on the net passive income. If you
account as a nonpassive loss only to
instead of $150,000. Married persons
have an overall loss on an entire
the extent that it exceeds that net
filing separate returns who lived with
disposition of your interest in a
passive income.
their spouses at any time during the
passive activity, reduce net passive
year are not eligible for the special
income, if any, on Form 8582, line 4,
allowance. They must enter -0- on
Line 12. Do not enter more than
to the extent of the loss (but not
line 16 and go to line 17.
$12,500 on line 12 if you are married
below zero) and use only the
filing a separate return and you and
remaining net passive income in the
Line 10. To figure modified adjusted
your spouse lived apart at all times
computation below. If you had a net
gross income, combine all the
passive activity loss, enter -0- on line
during the year. Married persons filing
amounts used to figure adjusted
6 and go to line 7.
separate returns who lived with their
gross income except do not take into
spouses at any time during the year
account:
Figure the tax on net passive
are not eligible for the special
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income as follows.
allowance. They must enter -0- on
Any passive activity loss as defined
in section 469(d)(1),
line 16 and go to line 17.
A. Taxable income
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Any rental real estate loss allowed
including net
Line 15. Figure the tax attributable
to real estate professionals (defined
passive income . . . . .
under Activities That Are Not Passive
to the amount on line 14 as follows.
B. Tax on line A* . . . . . . . . . . . . . .
Activities on page 1),
C. Taxable income without
A. Taxable income . . . . . . .
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Any overall loss from a PTP,
net passive income . . .
B. Tax on line A* . . . . . . . . . . . . . .
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The taxable amount of social
D. Tax on line C* . . . . . . . . . . . . . .
security and tier 1 railroad retirement
C. Enter amount from Form
E. Subtract line D from line B
8582-CR, line 14 . . . . . .
benefits,
and enter the result on
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Form 8582-CR, line 6 . . . . . . . . .
D. Subtract line C from line
Deductible contributions to
A . . . . . . . . . . . . . . . .
traditional individual retirement
* For Form 1040, use the Tax Table, Tax Computation
Worksheet, or other appropriate method you used to
accounts (IRAs) and section
E. Tax on line D* . . . . . . . . . . . . . .
figure your tax. For Form 1041, use the Tax Rate
501(c)(18) pension plans,
Schedule, Qualified Dividends Tax Worksheet, or
F. Subtract line E from line B
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Schedule D, whichever applies.
The domestic production activities
and enter the result on
Form 8582-CR, line 15 . . . . . . . .
deduction,
Note. When using taxable income in
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The deduction allowed for one-half
the above computation, it is not
of self-employment taxes,
* For Form 1040, use the Tax Table, Tax Computation
necessary to refigure items that are
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Worksheet, or other appropriate method you used to
The exclusion from income of
based on a percentage of adjusted
figure your tax. For Form 1041, use the Tax Rate
interest from series EE and I U.S.
Schedule, Qualified Dividends Tax Worksheet, or
gross income.
savings bonds used to pay higher
Schedule D, whichever applies.
education expenses,
Line 7. If line 7 is zero because the
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Note. When using taxable income in
The exclusion of amounts received
tax on the net passive income on line
under an employer’s adoption
the above computation, it is not
6 is greater than your credits from
assistance program,
necessary to refigure items that are
passive activities on line 5, all your
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based on a percentage of adjusted
credits from passive activities are
The student loan interest
gross income.
allowed. In this case, enter the
deduction, or
-10-
Instructions for Form 8582-CR (2010)
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