Calculate her at-risk amount at the end of the second year

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Sarah purchased for $90,000 a 10% interest in a business partnership that is not subject to the passive activity rules. During the first year, her share of the entity's loss was $120,000. At the beginning of the second year, the entity obtained $800,000 of recourse financing. During the second year, Sarah withdrew cash of $35,000 from the entity, and her share of the entity's loss was $5,000. Calculate her at-risk amount at the end of the second year

Reference no: EM131788224

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