Instructions For Form 8582-Cr (Rev. December 2009) printable pdf download

Instructions for Form

Department of the Treasury

Internal Revenue Service

8582-CR

(Rev. December 2009)

Passive Activity Credit Limitations

general overview of how the form

3. A working interest in an oil or

Section references are to the Internal

Revenue Code unless otherwise noted.

works.

gas well. Your working interest must

be held directly or through an entity

General Instructions

Also, as you read the instructions

that does not limit your liability (such

that follow, see Example of How To

as a general partner interest in a

Complete Form 8582-CR, beginning

Purpose of Form

partnership). In this case, it does not

on page 5. The example goes

matter whether you materially

Form 8582-CR is used by

through a six-step analysis of how the

participated in the activity for the tax

noncorporate taxpayers to figure the

form and worksheets are completed

year.

amount of any passive activity credit

for a partner in a limited partnership

If, however, your liability was

(PAC) for the current tax year

that has a low-income housing credit.

limited for part of the year (for

(including any prior year unallowed

example, you converted your general

credits) and the amount of credit

Activities That Are Not

partner interest to a limited partner

allowed for the current year. It also is

interest during the year), some of

used to make the election to increase

Passive Activities

your income and losses from the

the basis of credit property when a

The following are not passive

working interest may be treated as

taxpayer disposes of his or her

activities.

passive activity gross income and

interest in an activity.

1. Trade or business activities in

passive activity deductions. See

PACs that are not allowed in the

which you materially participated for

Temporary Regulations section

current year are carried forward until

the tax year.

1.469-1T(e)(4)(ii).

they are allowed against the tax on

4. The rental of a dwelling unit you

2. Any rental real estate activity in

either net passive income or the

used as a residence if section

which you materially participated if

special allowance, if applicable.

280A(c)(5) applies. This section

you were a “real estate professional”

Different rules apply to your

applies if you rented out a dwelling

for the tax year. You were a real

activities and the related credit,

unit that you also used as a home

estate professional only if:

depending on the type of activity.

during the year for a number of days

a. More than half of the personal

Generally, passive activities include:

that exceeds the greater of 14 days

•

services you performed in trades or

Trade or business activities in

or 10% of the number of days during

businesses during the tax year were

which you did not materially

the year that the home was rented at

performed in real property trades or

participate for the tax year.

a fair rental.

•

businesses in which you materially

Rental activities, regardless of your

5. An activity of trading personal

participated, and

participation.

property for the account of owners of

b. You performed more than 750

See Trade or Business Activities

interests in the activity. For purposes

hours of services during the tax year

on page 3 and Rental Activities on

of this rule, personal property means

in real property trades or businesses

this page.

property that is actively traded, such

in which you materially participated.

as stocks, bonds, and other

For more information, see Pub.

For purposes of item (2), each

securities. See Temporary

925, Passive Activity and At-Risk

interest in rental real estate is a

Regulations section 1.469-1T(e)(6).

Rules.

separate activity unless you elect to

treat all interests in rental real estate

Note. Corporations subject to the

Generally, credits from these

as one activity.

passive activity rules must use Form

activities are not entered on Form

8810, Corporate Passive Activity

If you are married filing jointly, one

8582-CR. However, credits from

Loss and Credit Limitations.

spouse must separately meet both

these activities may be subject to

(2)(a) and (2)(b) without taking into

limitations other than the passive

Who Must File

account services performed by the

credit limitation rules.

other spouse.

Form 8582-CR is filed by individuals,

estates, and trusts with any of the

A real property trade or business is

Rental Activities

following credits from passive

any real property development,

A rental activity is a passive activity

activities.

redevelopment, construction,

•

even if you materially participated in

General business credits.

reconstruction, acquisition,

•

the activity (unless it is a rental real

Qualified plug-in electric and

conversion, rental, operation,

estate activity in which you materially

electric vehicle credit.

management, leasing, or brokerage

participated and you were a real

trade or business.

estate professional).

Overview of Form

Services you performed as an

The form contains six parts. The

employee are not treated as

However, if you meet any of the

Specific Instructions, starting on page

performed in a real property trade or

five exceptions listed below, the

8, include, at the beginning of the

business unless you owned more

rental of the property is not treated as

instructions for each part, a brief

than 5% of the stock (or more than

a rental activity. See Reporting

explanation of the purpose or use of

5% of the capital or profits interest) in

Credits From the Activities on page 2

that part. These explanations give a

the employer.

if you meet any of the exceptions.

Cat. No. 64649B

Instructions For Form 8582-Cr (Rev. December 2009)

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