Discussion:PTP Passive income and Section 751
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Discussion Forum Index --> Advanced Tax Questions --> PTP Passive income and Section 751
Discussion Forum Index --> Tax Questions --> PTP Passive income and Section 751
| 13 May 2008 | |
| My client invested in an oil & gas Publically traded partnership. He has passive loss carryovers from this partnership. He originally purchased 1500 shares and sold 500 of those shares in 2007. He does not have a complete disposition of his interest.
He has a $10,000 gain from the sale of which appprox. $4,500 is Section 751 ordinary income from the disposition of hot assets. The K-1 instructions state that "the ordinary income on the sale of assets represents the depreciation and depletion deductions previously allocated to you." Question: Is this $4,500 passive income? Thank you | |
| 13 May 2008 | |
IRC Sec 469. The term passive activity means any activity -
(A) which involves the conduct of any trade or business, and
(B) in which the taxpayer does not materially participate.
Therefore I would suggest this is passive income. | |
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