Instructions For Form 8582cr - Passive Activity Credit Limitations (Page 15 of 16) in pdf

identifiable market maker, but holders

Step 3. Reduce rehabilitation credits

instructions. Subtract the credits

of interests have a readily available,

from rental real estate activities from

allowed in Step 5 above from the tax

regular, and ongoing opportunity to

each PTP, low-income housing

figured on line K of that worksheet.

sell or exchange their interests

credits for property placed in service

The result is the tax attributable to the

through a public means of obtaining

before 1990 from each PTP, and any

special allowance available for the

or providing information on offers to

low-income housing credits (including

credits in Step 6.

buy, sell, or exchange interests.

prior year unallowed credits) from

Step 8. Low-income housing credits

Similarly, the substantial equivalent of

each PTP in which you acquired your

allowed under the special allowance

a secondary market exists if

interest before 1990 (regardless of

for property placed in service after

prospective buyers and sellers have

the date placed in service) to the

1989 from a PTP in which you also

the opportunity to buy, sell, or

extent of the tax, which was figured in

acquired your interest after 1989 are

exchange interests in a timeframe

Step 1, attributable to net passive

the smaller of the total credits from

and with the regularity and continuity

income from that PTP.

Step 6 or the amount figured in Step

that the existence of a market maker

Step 4. Before beginning this step,

7. If Step 7 is smaller than Step 6,

would provide.

complete Form 8582-CR if you have

allocate the amount in Step 7 pro rata

Credits From PTPs

any passive credits that are not from

to the credits from each PTP in Step

PTPs. Subtract the total of lines 16,

A credit from a passive activity held

30, and 36, if any, of Form 8582-CR,

through a PTP is allowed to the

Step 9. Add the credits from Steps

from the amount on line 27 of Form

extent of the tax attributable to net

2, 5, and 8. These are the total

8582-CR, to figure the tax attributable

passive income from that partnership.

credits allowed from passive activities

to the special allowance available for

In addition, rehabilitation credits and

of PTPs.

the credits in Step 3.

low-income housing credits from

rental real estate activities held

If your only passive credits are

Step 10. Figure the allowed and

through PTPs are allowed to the

from PTPs, complete lines 21 through

unallowed credits from each PTP.

extent of any special allowance that

27 of Form 8582-CR as a worksheet.

Report the allowed credits on the

remains after taking into account

The amount on line 27 is the tax

forms normally used. Keep a record

losses and credits from rental real

attributable to the special allowance

of the unallowed credits to be carried

estate activities not owned through

available for the credits in Step 3.

forward to next year.

PTPs. See Special Allowance for

Step 5. Rehabilitation credits from

Rental Real Estate Activities, earlier.

rental real estate activities of PTPs,

Part VI—Election To

Do not enter credits from

low-income housing credits for

PTPs on the worksheets or on

property placed in service before

Increase Basis of Credit

Form 8582-CR. Instead, use

1990 by PTPs, and low-income

CAUTION

Property

the following steps to figure the

housing credits from PTPs in which

allowed and unallowed credits from

you acquired your interest before

Complete Part VI if you disposed of

passive activities held through PTPs.

1990 (regardless of the date placed in

your entire interest in a passive

service) allowed under the special

Computation of Allowed

activity and elect to increase the

allowance are the smaller of the total

basis of the credit property used in

Passive Activity Credits

credits from Step 3 or the amount

the activity by the unallowed credit

From PTPs

figured in Step 4. If Step 4 is smaller

that reduced the basis of the

than Step 3, allocate the amount in

Complete Steps 1 and 2 only if you

property.

Step 4 pro rata to the credits from

have net passive income from a PTP

each PTP in Step 3.

Line 38. Check the box if you elect

with passive activity credits (including

to increase the basis of credit

prior year unallowed credits).

Complete Steps 6 through 8 only if

property used in a passive activity by

Step 1. Figure the tax attributable to

you have low-income housing credits

the unallowed credit that reduced the

net passive income from each PTP

(including prior year unallowed

property’s basis. The election is

with passive activity credits (including

credits) for property placed in service

available for a fully taxable disposition

prior year unallowed credits) by

after 1989 from a PTP in which you

of an entire interest in an activity for

following the steps shown in the

acquired your interest after 1989.

which a basis adjustment was made

worksheet in the line 6 instructions.

Step 6. Reduce low-income housing

as a result of placing in service

Complete a separate tax computation

credits (including prior year unallowed

property for which a credit was taken.

for each PTP with net passive

credits) for property placed in service

You may elect to increase the basis

income.

after 1989 from each PTP in which

of the credit property immediately

Step 2. Passive activity credits from

you also acquired your interest after

before the disposition (by an amount

each PTP are allowed to the extent of

1989 to the extent of the tax

no greater than the amount of the

the tax attributable to net passive

attributable to net passive income

original basis reduction) to the extent

income from the same PTP. Credits

from that PTP, which was figured in

that the credit had not been allowed

in excess of the tax attributable to net

Step 1.

previously because of the passive

passive income may be allowed

activity credit limitations. The amount

Step 7. Before beginning this step,

under one or more steps below.

of the unallowed credit that may be

complete Form 8582-CR if you have

Complete Steps 3 through 5 only if

applied against tax is reduced by the

any passive credits that are not from

your passive activity credits (including

amount of the basis adjustment.

PTPs. Subtract the sum of the credits

prior year unallowed credits) include

allowed in Step 5 above and Form

No basis adjustment may be

rehabilitation credits from rental real

8582-CR, line 36, from the amount on

elected on a partial disposition of your

estate activities from PTPs,

Form 8582-CR, line 35, to figure the

interest in a passive activity or if the

low-income housing credits for

tax attributable to the special

disposition is not fully taxable. The

property placed in service before

allowance available for the credits in

amount of any unallowed credit,

1990 from PTPs, or low-income

Step 6.

however, remains available to offset

housing credits from PTPs in which

the tax attributable to net passive

you acquired your interest before

If your only passive credits are

income.

1990 (regardless of the date placed in

from PTPs, complete the steps

service).

shown in the worksheet in the line 35

-15-

Instructions for Form 8582-CR (Rev. 01-2012)

Instructions For Form 8582cr - Passive Activity Credit Limitations Page 15

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