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21SS-0100: Surgent's Four Tiers of Loss Limitations: A Guide to the New Rules for Pass-through Entities (Self-Study)

Date Valid for one year from purchase date
Format On-Demand
CPE credits CPE 4.0
of study
Taxes - Technical (4.0)
Standard Member Fee $89.00
Standard Nonmember Fee $89.00


Owners of S Corporations and partnerships are subject to numerous limitations on pass-through losses, each with unique rules, applications, and complexities. With the increase in popularity of pass-through business entities, it is essential for CPAs to understand the complexities and interactions of these pass-through loss limitations.

Who should take this program?

Experienced practitioners who desire a refresher on loss limitations and an analysis of the new rules. Inexperienced practitioners who desire to learn the basics of all four pass-through loss limitations and their interactions in one course.

Major subjects

  • Tier 1: Basis limitations for S Corporation shareholders and partners
  • Tier 2: Section 465 at-risk limitations for S Corporation shareholders and partners, including the impact of debt, indemnities, guarantees, and shareholder/partner agreements
  • Tier 3: Section 469 passive loss limitations and exceptions to the limitations
  • Tier 4: The new excess business loss limitation of the Tax Cuts and Jobs Act of 2017 (new section 461(l))

Learning objective(s)

  • Analyze how basis in an ownership interest in a pass-through entity is established
  • Discuss how activity of the entity, distributions, and optional adjustments increase or decrease basis
  • Discuss when basis is "at-risk" under section 465, and the resulting loss disallowance and carryforward related to basis that is not at-risk
  • Define passive activities under section 469 and exceptions to the passive loss rules
  • Discuss when and how aggregation of activities should be used to avoid the passive loss rules
  • Analyze new Section 461(l) created by the Tax Cuts and Jobs Act of 2017 and understand the limitation calculation and resulting carryforward
  • Analyze the hierarchy of the loss limitations with examples of the application of the four tiers of losses and how they interact


Course code Code 21SS-0100
Sponsor Surgent
NASBA ID#: 103212
Level Intermediate
Format On-Demand
Prerequisites Prereq. Basic familiarity with loss allowance rules of pass-through entities
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