Meeting the Passive Loss Requirements as a Surviving Spouse

Abstract

<p>The Internal Revenue Service has addressed, in a technical advice memorandum,<strong>1 </strong>the cross-referencing from the special use valuation rules<strong>2 </strong>to the passive activity rules<strong>3 </strong>in determining whether the material participation rules (on a regular, continuous and<strong> </strong>substantial basis<strong>4­</strong>) were met for a farming operation after the death of the husband and<strong> </strong>before the death of the wife.<strong>5 </strong>The farm operation was conducted through a limited liability<strong> </strong>company wholly owned by a grantor trust.<strong>6</strong></p>