Submitted By: Betty
Answered: August 31, 2015 12:11 pm

I had rental property on which there were suspended passive losses. Then my child lived in the property for several years (personal use for which no rent was received). I just sold the property. Can I take the suspended passive losses?

Suspended passive losses become deductible in the year in which there is a complete disposition of the property in a fully taxable event to an unrelated party. The fact that the losses remained suspended during the years of personal use does not erase them; the losses become deductible in the year of sale without regard to passive activity income.

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Tax Glossary

Intangible assets

Intangible assets that come within Section 197, such as goodwill, are amortizable over a 15-year period.

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