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This year, individual X and individual Y formed XY Partnership. X contributed $56,250 cash, and Y contributed business assets with a $56,250 FMV. Y's adjusted basis in these assets was only $11,250. The partnership agreement provides that income and loss will be divided equally between the two partners. Partnership operations for the year generated a $68,400 loss. How much loss may each partner deduct currently, and what basis will each partner have in her interest at the beginning of next year? (Losses and deductions should be entered as negative numbers.) Partner X Partner Y Initial basis in partnership interest Deduction for share of partnership loss Adjusted basis at beginning of next year At the beginning of 2017, Ms. P purchased a 15 percent interest in PPY Partnership for $24,000. Ms. P's Schedule K-1 reported that her share of PPY's debt at year-end was $31000, and her share of ordinary loss was $51,400. On January 1,2018, Ms. P sold her interest to another partner for $3,900 cash. a. How much of her share of PPY's loss can Ms. P deduct on her 2017 return? b. Compute Ms. P's recognized gain on sale of her PPY interest c. How would your answers to parts a and b change if PPY were an S corporation instead of a partnership? Complete this question by entering your answers in the tabs below Required A Required B Required C How much of her share of PPY's loss can Ms. P deduct on her 2017 return? red A Required B

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