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دستورالعمل 8582

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Department of the Treasury  
Internal Revenue Service  
2023  
Instructions for Form 8582  
Passive Activity Loss Limitations  
Section references are to the Internal Revenue Code  
unless otherwise noted.  
PALs can’t be used to offset income from nonpassive  
activities. However, a special allowance for rental real  
estate activities may allow some losses even if the losses  
exceed passive income.  
Future Developments  
For the latest information about developments related to  
Form 8582 and its instructions, such as legislation  
enacted after they were published, go to IRS.gov/  
PALs not allowed in the current year are carried  
forward until they’re allowed either against passive activity  
income; against the special allowance, if applicable; or  
when you sell or exchange your entire interest in the  
activity in a fully taxable transaction to an unrelated party.  
General Instructions  
Reminders  
For more information, see Pub. 925, Passive Activity  
and At-Risk Rules.  
Prior year unallowed commercial revitalization de-  
duction (CRD). If you have prior year unallowed CRDs  
limited by the passive loss rules, you may continue to  
include them in the calculations as shown in the Specific  
Instructions, beginning with Part I—2023 Passive Activity  
Loss, later.  
Excess business loss limitation. If you are a  
noncorporate taxpayer and have allowable business  
losses after taking into account first the at-risk limitations  
and then the passive loss limitations (this form), your  
losses may be subject to the excess business loss  
limitation. After taking into account all the other loss  
limitations, complete Form 461, Limitation on Business  
Losses, to figure the amount of your excess business  
loss. See Form 461 and its instructions for details on the  
excess business loss limitation.  
Reporting prior year unallowed losses. Form 8582  
must generally be filed by taxpayers who have an overall  
gain (including any prior year unallowed losses) from  
business or rental passive activities. See Exception under  
Who Must File, later.  
Regrouping due to Net Investment Income Tax. You  
may be able to regroup your activities if you’re subject to  
the Net Investment Income Tax. See Regrouping Due to  
Net Investment Income Tax under Grouping of Activities,  
later, for more information.  
Note. Corporations subject to the passive activity rules  
must use Form 8810, Corporate Passive Activity Loss and  
Credit Limitations.  
Who Must File  
Form 8582 is filed by individuals, estates, and trusts who  
have passive activity deductions (including prior year  
unallowed losses). However, you don’t have to file Form  
8582 if you meet the following exception.  
Exception  
You actively participated in rental real estate activities  
later), and you meet all of the following conditions.  
Rental real estate activities with active participation  
were your only passive activities.  
You have no prior year unallowed losses from these (or  
any other passive) activities.  
Your total loss from the rental real estate activities  
wasn’t more than $25,000 ($12,500 if married filing  
separately).  
If you’re married filing separately, you lived apart from  
your spouse all year.  
You have no current or prior year unallowed credits  
from a passive activity.  
Your modified adjusted gross income (see the  
instructions for line 6, later) was not more than $100,000  
(not more than $50,000 if married filing separately).  
Purpose of Form  
You don’t hold any interest in a rental real estate activity  
Form 8582 is used by noncorporate taxpayers to figure  
the amount of any passive activity loss (PAL) for the  
current tax year and to report the application of prior year  
unallowed PALs.  
as a limited partner or as a beneficiary of an estate or a  
trust.  
If all the above conditions are met, your rental real  
estate losses are not limited, and you don’t need to  
complete Form 8582. Enter losses reported on  
A PAL occurs when total losses (including prior year  
unallowed losses) from all your passive activities exceed  
the total income from all your passive activities.  
Schedule E (Form 1040), Supplemental Income and Loss,  
Part I, line 21, on Schedule E (Form 1040), Part l, line 22.  
For losses from a partnership or an S corporation, enter  
the amount of the allowable loss from Schedule K-1 on  
Schedule E (Form 1040), Part II, column (g). Enter losses  
reported on line 32 of Form 4835, Farm Rental Income  
and Expenses, on Form 4835, line 34c.  
Generally, passive activities include the following.  
Trade or business activities in which you did not  
materially participate for the tax year.  
Rental activities, regardless of your participation.  
Jun 23, 2023  
Cat. No. 64294A  
 
were performed in real property trades or businesses in  
which you materially participated, and  
b. You performed more than 750 hours of services  
during the tax year in real property trades or businesses in  
which you materially participated.  
Coordination With Other Limitations  
Generally, PALs are subject to other limitations (for  
example, basis and at-risk limitations) before they’re  
subject to the passive loss limitations. Once a loss  
becomes allowable under these other limitations, you  
must determine whether the loss is limited under the  
passive loss rules. See Form 6198, At-Risk Limitations,  
for details on the at-risk rules. Also, capital losses that are  
allowable under the passive loss rules may be limited  
under the capital loss limitations of section 1211.  
Percentage depletion deductions that are allowable under  
the passive loss rules may be limited under section  
613A(d).  
For purposes of whether you materially participated  
under item (2), each interest in rental real estate is a  
separate activity, unless you elect to treat all interests in  
rental real estate as one activity. For details on making  
this election, see the Instructions for Schedule E (Form  
1040).  
If you’re married filing jointly, one spouse must  
separately meet both (2)(a) and (2)(b) without taking into  
account services performed by the other spouse.  
If you have allowable business losses after taking into  
account the loss limitations discussed above and  
computing the allowable passive losses on this form, your  
losses may be subject to the excess business loss  
limitation. Complete Form 461 to figure the amount of your  
excess business loss. Any disallowed loss resulting from  
this limitation will be treated as a net operating loss (NOL)  
that must be carried forward and deducted in a  
A real property trade or business is any real property  
development, redevelopment, construction,  
reconstruction, acquisition, conversion, rental, operation,  
management, leasing, or brokerage trade or business.  
Real property includes land, buildings, and other  
inherently permanent structures permanently affixed to  
land. Any interest in real property, including fee  
ownership, co-ownership, leasehold, option, or similar  
interest is real property. Tenant improvements to land,  
buildings, or other structures that are inherently  
permanent or otherwise classified as real property are real  
property for this purpose. See Regulations section  
1.469-9(b)(2) for more definitions and information about  
determining whether a trade or business is a real property  
trade or business.  
For examples of the determination of whether a trade or  
business is a real property trade or business, see  
Regulations section 1.469-9(b)(2)(iii).  
Services you performed as an employee aren’t treated  
as performed in a real property trade or business unless  
you owned more than 5% of the stock (or more than 5% of  
the capital or profits interest) in the employer.  
subsequent year. See Form 461 and its instructions for  
details on the excess business loss limitation.  
Definitions  
Except as otherwise indicated, the following terms in  
these instructions are defined as shown below.  
Net income. This is the excess of current year income  
over current year deductions from the activity. This  
includes any current year gains or losses from the  
disposition of assets or an interest in the activity.  
Net loss. This is the excess of current year deductions  
over current year income from the activity. This includes  
any current year gains or losses from the disposition of  
assets or an interest in the activity.  
Overall gain. This is the excess of the “net income” from  
the activity over the prior year unallowed losses from the  
activity.  
Overall loss. This is (a) the excess of the prior year  
unallowed losses from the activity over the “net income”  
from the activity, or (b) the prior year unallowed losses  
from the activity plus the “net loss” from the activity.  
Note. If a rental real estate activity isn’t a passive activity  
for the current year, any prior year unallowed loss is  
treated as a loss from a former passive activity. See  
3. A working interest in an oil or gas well. Your working  
interest must be held directly or through an entity that  
doesn’t limit your liability (such as a general partner  
interest in a partnership). In this case, it doesn’t matter  
whether you materially participated in the activity for the  
tax year.  
If, however, your liability was limited for part of the year  
(for example, you converted your general partner interest  
to a limited partner interest during the year), some of your  
income and losses from the working interest may be  
treated as passive activity gross income and passive  
activity deductions. See Temporary Regulations section  
1.469-1T(e)(4)(ii).  
4. The rental of a dwelling unit you used as a  
residence if section 280A(c)(5) applies. This section  
applies if you rented out a dwelling unit that you also used  
as a home during the year for a number of days that  
exceeds the greater of 14 days or 10% of the number of  
days during the year that the home was rented at a fair  
rental.  
Prior year unallowed losses. These are the losses from  
an activity that were disallowed under the PAL limitations  
in a prior year and carried forward to the tax year under  
section 469(b). See Regulations section 1.469-1(f)(4) and  
Pub. 925.  
Activities That Are Not Passive  
Activities  
The following aren’t passive activities.  
1. Trade or business activities in which you materially  
participated for the tax year.  
2. Any rental real estate activity in which you materially  
participated if you were a “real estate professional” for the  
tax year. You were a real estate professional only if:  
a. More than half of the personal services you  
performed in trades or businesses during the tax year  
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Instructions for Form 8582 (2023)  
   
5. An activity of trading personal property for the  
account of owners of interests in the activity. For purposes  
of this rule, personal property means property that’s  
actively traded, such as stocks, bonds, and other  
securities. See Temporary Regulations section  
1.469-1T(e)(6) for more details.  
by the ratio of the gross rental income from that class to  
the activity's total gross rental income. The activity's  
average period of customer use equals the sum of these  
class-by-class average periods weighted by gross  
income. See Regulations section 1.469-1(e)(3)(iii).  
Significant personal services include only services  
performed by individuals. To determine if personal  
services are significant, all relevant facts and  
circumstances are taken into consideration, including the  
frequency of the services, the type and amount of labor  
required to perform the services, and the value of the  
services relative to the amount charged for use of the  
property.  
Generally, income and losses from these activities  
aren’t entered on Form 8582. However, losses from these  
activities may be subject to limitations other than the  
passive loss rules.  
Trade or Business Activities  
A trade or business activity is an activity (other than a  
rental activity or an activity treated as incidental to an  
activity of holding property for investment) that:  
2. Extraordinary personal services were provided in  
making the rental property available for customer use.  
This applies only if the services are performed by  
individuals and the customers' use of the property is  
incidental to their receipt of the services.  
1. Involves the conduct of a trade or business (within  
the meaning of section 162),  
2. Is conducted in anticipation of starting a trade or  
business, or  
3. Rental of the property is incidental to a nonrental  
activity.  
3. Involves research or experimental expenditures  
The rental of property is incidental to an activity of  
holding property for investment if the main purpose of  
holding the property is to realize a gain from its  
appreciation and the gross rental income is less than 2%  
of the smaller of the unadjusted basis or the fair market  
value (FMV) of the property.  
Unadjusted basis is the cost of the property without  
regard to depreciation deductions or any other basis  
adjustment described in section 1016.  
deductible under section 174.  
Trade or business activities are generally reported on  
Schedule C (Form 1040), Profit or Loss From Business  
(Sole Proprietorship); Schedule F (Form 1040), Profit or  
Loss From Farming; or in Part II or III of Schedule E (Form  
1040). For trade or business activities that are significant  
participation passive activities (defined in item 4 under  
Tests for individuals, later), see Pub. 925 for how to report  
their income or losses.  
The rental of property is incidental to a trade or  
Rental Activities  
business activity if:  
A rental activity is a passive activity even if you materially  
participated in the activity (unless it’s a rental real estate  
activity in which you materially participated and you were  
a real estate professional).  
a. You own an interest in the trade or business activity  
during the tax year,  
b. The rental property was mainly used in the trade or  
business activity during the tax year or during at least 2 of  
the 5 preceding tax years, and  
c. The gross rental income from the property is less  
than 2% of the smaller of the unadjusted basis or the FMV  
of the property.  
An activity is a rental activity if tangible property (real or  
personal) is used by customers or held for use by  
customers and the gross income (or expected gross  
income) from the activity represents amounts paid (or to  
be paid) mainly for the use of the property. It doesn’t  
matter whether the use is under a lease, a service  
contract, or some other arrangement.  
However, if you meet any of the five exceptions below,  
the rental of the property isn’t treated as a rental activity.  
later, if you meet any of the exceptions.  
Lodging provided for the employer's convenience to an  
employee or the employee's spouse or dependents is  
incidental to the activity or activities in which the employee  
performs services.  
4. You customarily make the rental property available  
during defined business hours for nonexclusive use by  
various customers.  
5. You provide property for use in a nonrental activity  
of a partnership, S corporation, or a joint venture in your  
capacity as an owner of an interest in the partnership, S  
corporation, or joint venture.  
Example. If a partner contributes the use of property  
to a partnership, none of the partner's distributive share of  
partnership income is income from a rental activity unless  
the partnership is engaged in a rental activity.  
Exceptions  
An activity is not a rental activity if any of the following  
apply.  
1. The average period of customer use is:  
a. 7 days or less, or  
b. 30 days or less and significant personal services  
were provided in making the rental property available for  
customer use.  
Also, a partner's gross income from a guaranteed  
payment under section 707(c) isn’t income from a rental  
activity. The determination of whether the property used in  
the activity is provided in the partner's capacity as an  
Figure the average period of customer use for a class  
of property by dividing the total number of days in all rental  
periods by the number of rentals during the tax year. If the  
activity involves renting more than one class of property,  
multiply the average period of customer use of each class  
Instructions for Form 8582 (2023)  
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owner of an interest in the partnership is made on the  
basis of all the facts and circumstances.  
Form 8855, Election To Treat a Qualified Revocable Trust  
as Part of an Estate.  
You aren’t considered to actively participate in a rental  
real estate activity if at any time during the tax year your  
interest (including your spouse's interest) in the activity  
was less than 10% (by value) of all interests in the activity.  
Active participation is a less stringent requirement than  
material participation (see Material Participation, later).  
You may be treated as actively participating if, for  
example, you participated in making management  
decisions or arranged for others to provide services (such  
as repairs) in a significant and bona fide sense.  
Management decisions that may count as active  
participation include:  
Reporting Income and Losses From the  
Activities  
If an activity meets any of the five exceptions listed above,  
it’s not a rental activity. You must then determine:  
1. Whether your rental of the property is a trade or  
business activity (see Trade or Business Activities,  
earlier), and, if so,  
2. Whether you materially participated in the activity  
for the tax year (see Material Participation, later).  
If the activity is a trade or business activity in which you  
didn’t materially participate, enter the income and losses  
from the activity in Part V.  
Approving new tenants,  
Deciding on rental terms,  
If the activity is a trade or business activity in which you  
did materially participate, report any income or loss from  
the activity on the forms or schedules normally used.  
Approving capital or repair expenditures, and  
Other similar decisions.  
The maximum special allowance is:  
If the rental activity didn’t meet any of the five  
exceptions, it’s generally a passive activity. However,  
special rules apply if you conduct the rental activity  
through a publicly traded partnership (PTP) or if any of the  
rules described under Recharacterization of Passive  
Income, later, apply. Also see the PTP rules, later.  
$25,000 for single individuals and married individuals  
filing a joint return for the tax year.  
$12,500 for married individuals who file separate  
returns for the tax year and lived apart from their spouses  
at all times during the tax year.  
$25,000 for a qualifying estate, reduced by the special  
allowance for which the surviving spouse qualified.  
If none of the special rules apply, enter the income and  
losses from the passive rental activity in Parts IV or V. See  
the instructions for Parts IV and V for details.  
Modified adjusted gross income limitation. If your  
modified adjusted gross income (see the instructions for  
line 6, later) is $100,000 or less ($50,000 or less if married  
filing separately), your loss is deductible up to the amount  
of the maximum special allowance referred to in the  
preceding paragraph.  
Special Allowance for Rental Real  
Estate Activities  
Active participation. If you actively participated in a  
passive rental real estate activity, you may be able to  
deduct up to $25,000 of loss from the activity from your  
nonpassive income. This special allowance is an  
exception to the general rule disallowing losses in excess  
of income from passive activities.  
If your modified adjusted gross income is more than  
$100,000 ($50,000 if married filing separately) but less  
than $150,000 ($75,000 if married filing separately), your  
special allowance is limited to 50% of the difference  
between $150,000 ($75,000 if married filing separately)  
and your modified adjusted gross income.  
Generally, if your modified adjusted gross income is  
$150,000 or more ($75,000 or more if married filing  
separately), there is no special allowance.  
The special allowance isn’t available if you were  
married, are filing a separate return for the year, and lived  
with your spouse at any time during the year.  
Only an individual, a qualifying estate, or a qualified  
revocable trust that made an election to treat the trust as  
part of the decedent's estate may actively participate in a  
rental real estate activity. Unless future regulations  
provide an exception, limited partners are not treated as  
actively participating in a partnership's rental real estate  
activity.  
If you qualify under the active participation rules, use  
Part IV. See the instructions for Part IV, later.  
Material Participation  
For the material participation tests listed below,  
participation generally includes any work done in  
connection with an activity if you owned an interest in the  
activity at the time you did the work. The capacity in which  
you did the work doesn’t matter. However, work isn’t  
participation if:  
A qualifying estate is the estate of a decedent for tax  
years ending less than 2 years after the date of the  
decedent's death if the decedent would’ve satisfied the  
active participation requirements for the rental real estate  
activity for the tax year the decedent died.  
It isn’t work that an owner would customarily do in the  
same type of activity, and  
One of your main reasons for doing the work was to  
A qualified revocable trust may elect to be treated as  
part of a decedent's estate for purposes of the special  
allowance for active participation in rental real estate  
activities. The election must be made by both the executor  
(if any) of the decedent's estate and the trustee of the  
revocable trust. For details, see Regulations section  
1.645-1. To make this election, see the instructions on  
avoid the disallowance of losses or credits from the  
activity under the passive activity rules.  
Proof of participation. You may prove your participation  
in an activity by any reasonable means. You don’t have to  
maintain contemporaneous daily time reports, logs, or  
similar documents if you can establish your participation  
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Instructions for Form 8582 (2023)  
     
by other reasonable means. For this purpose, reasonable  
means include, but are not limited to, identifying services  
performed over a period of time and the approximate  
number of hours spent performing the services during that  
period, based on appointment books, calendars, or  
narrative summaries.  
Tests for individuals. You materially participated for the  
tax year in an activity if you satisfy at least one of the  
following tests.  
an interest in the activity and whether or not you and your  
spouse file a joint return for the tax year.  
Tests for investors. Work done as an investor in an  
activity isn’t treated as participation unless you were  
directly involved in the day-to-day management or  
operations of the activity. For purposes of this test, work  
done as an investor includes the following.  
1. Studying and reviewing financial statements or  
reports on operations of the activity.  
1. You participated in the activity for more than 500  
2. Preparing or compiling summaries or analyses of  
the finances or operations of the activity for your own use.  
hours.  
2. Your participation in the activity for the tax year was  
substantially all of the participation in the activity of all  
individuals (including individuals who didn’t own any  
interest in the activity) for the year.  
3. You participated in the activity for more than 100  
hours during the tax year, and you participated at least as  
much as any other individual (including individuals who  
didn’t own any interest in the activity) for the year.  
4. The activity is a significant participation activity for  
the tax year, and you participated in all significant  
participation activities during the year for more than 500  
hours.  
A significant participation activity is any trade or  
business activity in which you participated for more than  
100 hours during the year and in which you didn’t  
materially participate under any of the material  
participation tests (other than this fourth test).  
3. Monitoring the finances or operations of the activity  
in a nonmanagerial capacity.  
Special rules for limited partners. If you were a limited  
partner in an activity, you generally didn’t materially  
participate in the activity. You did materially participate in  
the activity, however, if you met material participation test  
1, 5, or 6 under Tests for individuals, earlier, for the tax  
year.  
However, for purposes of the material participation  
tests, you aren’t treated as a limited partner if you also  
were a general partner in the partnership at all times  
during the partnership's tax year ending with or within your  
tax year (or, if shorter, during the portion of the  
partnership's tax year in which you directly or indirectly  
owned your limited partner interest).  
Special rules for certain retired or disabled farmers  
and surviving spouses of farmers. Certain retired or  
disabled farmers and surviving spouses of farmers are  
treated as materially participating in a farming activity if  
the real property used in the activity would meet the estate  
tax rules for special valuation of farm property passed  
from a qualifying decedent. See Temporary Regulations  
section 1.469-5T(h)(2).  
Estates and trusts. The PAL limitations apply in figuring  
the distributable net income and taxable income of an  
estate or trust. The rules for determining material  
participation for this purpose haven’t yet been issued.  
5. You materially participated in the activity (other than  
by meeting this fifth test) for any 5 (whether or not  
consecutive) of the 10 immediately preceding tax years.  
6. The activity is a personal service activity in which  
you materially participated for any 3 (whether or not  
consecutive) preceding tax years.  
An activity is a personal service activity if it involves the  
performance of personal services in the fields of health,  
law, engineering, architecture, accounting, actuarial  
science, performing arts, consulting, or in any other trade  
or business in which capital isn’t a material  
income-producing factor.  
Grouping of Activities  
7. Based on all the facts and circumstances, you  
participated in the activity on a regular, continuous, and  
substantial basis during the tax year.  
You didn’t materially participate in the activity under this  
seventh test, however, if you participated in the activity for  
100 hours or less during the tax year.  
Your participation in managing the activity doesn’t  
count in determining whether you materially participated  
under this test if:  
Generally, one or more trade or business activities or  
rental activities may be treated as a single activity if the  
activities make up an appropriate economic unit for the  
measurement of gain or loss under the passive activity  
rules.  
Whether activities make up an appropriate economic  
unit depends on all the relevant facts and circumstances.  
The factors given the greatest weight in determining  
whether activities make up an appropriate economic unit  
are:  
a. Any person (except you) received compensation for  
performing services in the management of the activity, or  
1. Similarities and differences in types of trades or  
b. Any individual spent more hours during the tax year  
performing services in the management of the activity  
than you did (regardless of whether the individual was  
compensated for the management services).  
businesses,  
2. The extent of common control,  
3. The extent of common ownership,  
4. Geographical location, and  
Test for a spouse. Participation by your spouse during  
the tax year in an activity you own may be counted as your  
participation in the activity even if your spouse didn’t own  
5. Interdependencies between or among the activities.  
Example. You have a significant ownership interest in  
a bakery and a movie theater in Baltimore and in a bakery  
Instructions for Form 8582 (2023)  
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and a movie theater in Philadelphia. Depending on all the  
relevant facts and circumstances, there may be more than  
one reasonable method for grouping your activities. For  
instance, the following groupings may or may not be  
permissible.  
Activities conducted through other partnerships and  
corporations.  
A partner or shareholder may not treat as separate  
activities those activities grouped together by the  
partnership or corporation.  
A single activity.  
A movie theater activity and a bakery activity.  
A Baltimore activity and a Philadelphia activity.  
Four separate activities.  
Regrouping Due to Net Investment Income Tax  
You may be able to regroup your activities, as described  
below, if you’re subject to the Net Investment Income Tax  
(NIIT) for the first time. For detailed information, see  
Regulations section 1.469-11(b)(3)(iv).  
Once you choose a grouping under these rules, you  
must continue using that grouping in later tax years unless  
it’s determined that the original grouping was clearly  
inappropriate or a material change in the facts and  
circumstances makes it clearly inappropriate.  
Regrouping on an original return. Under the NIIT fresh  
start election, you may regroup for the first tax year you’re  
subject to the NIIT (without regard to the effect of  
regrouping). You may regroup only once under this  
election and that regrouping will apply to the tax year for  
which you regroup and all future tax years. You’re eligible  
to regroup if:  
The IRS may regroup your activities if your grouping  
fails to reflect one or more appropriate economic units and  
one of the primary purposes of your grouping is to avoid  
the passive activity limitations.  
Limitation on grouping certain activities. The  
1. You weren’t previously subject to the NIIT;  
following activities may not be grouped together.  
2. The amount you would have entered on Form 8960,  
line 12, without the regrouping, would have been greater  
than zero; and  
3. The amount you would have entered on Form 8960,  
line 13, without the regrouping, would have been greater  
than the amount you would have entered on Form 8960,  
line 14, without the regrouping.  
1. A rental activity with a trade or business activity  
unless the activities being grouped together make up an  
appropriate economic unit and:  
a. The rental activity is insubstantial relative to the  
trade or business activity or vice versa, or  
b. Each owner of the trade or business activity has the  
same proportionate ownership interest in the rental  
activity. If so, the portion of the rental activity involving the  
rental of property used in the trade or business activity  
may be grouped with the trade or business activity.  
2. An activity involving the rental of real property with  
an activity involving the rental of personal property (except  
personal property provided in connection with the real  
property or vice versa).  
Regrouping on an amended return. You may regroup  
your activities on an amended tax return, but only if you  
weren’t subject to the NIIT on your original return (or  
previously amended return). You’re eligible if:  
1. You weren’t previously subject to the NIIT for the tax  
year for which you’re filing an amended return or any prior  
tax year;  
2. The changes on the amended return cause you to  
be subject to the NIIT for the first time beginning in the  
taxable year for which you’re amending the return;  
3. Any activity with another activity in a different type  
of business and in which you hold an interest as a limited  
partner if that other activity engages in holding, producing,  
or distributing motion picture films or videotapes; farming;  
leasing section 1245 property; or exploring for or  
3. The limitation period for assessments under section  
6501 hasn’t ended;  
exploiting oil and gas resources or geothermal deposits.  
4. The changes on your amended return cause the  
amount on Form 8960, line 12, of your amended return to  
be greater than zero; and  
5. The changes on your amended return cause the  
amount on Form 8960, line 13, of your amended return to  
be greater than the amount entered on Form 8960,  
line 14.  
4. Any trading activities in which you don't materially  
participate. A trading activity is an activity of trading in  
personal property. For this purpose, personal property is  
any personal property that is actively traded, for example,  
financial securities. A taxpayer who does not materially  
participate in a trading activity is prohibited from grouping  
the activity with any other activity, including any other  
trading activity. The prohibition on grouping is effective for  
taxable years beginning on or after March 22, 2021. If you  
are a calendar year taxpayer, the new provisions first  
applied to you in calendar year 2022.  
This rule applies equally to changes to modified  
adjusted gross income or net investment income upon an  
IRS examination.  
Manner of regrouping. If you regroup your activities  
under this rule, you must attach to your original or  
amended return, as applicable, a statement that satisfies  
the requirements described in Regrouping under  
Disclosure Requirement next.  
Activities conducted through partnerships, S corpo-  
rations, and C corporations subject to section 469.  
Once a partnership or corporation determines its activities  
under these rules, a partner or shareholder may use these  
rules to group those activities with:  
Disclosure Requirement  
Each other,  
The following disclosure requirements for groupings  
apply. You’re required to report certain changes to your  
groupings that occur during the tax year to the IRS. If you  
fail to report these changes, each trade or business  
Activities conducted directly by the partner or  
shareholder, or  
-6-  
Instructions for Form 8582 (2023)  
 
activity or rental activity will be treated as a separate  
activity. You’ll be considered to have made a timely  
disclosure if you filed all affected income tax returns  
consistent with the claimed grouping and make the  
required disclosure on the income tax return for the year in  
which you first discovered the failure to disclose. If the IRS  
discovered the failure to disclose, you must have  
reasonable cause for not making the required disclosure.  
For more information on disclosure requirements, see  
Revenue Procedure 2010-13, available at IRS.gov/irb/  
income or deduction separately to you, and the gross  
income or deduction is passive activity gross income or a  
passive activity deduction (respectively), include that  
amount in the net income or net loss entered on Form  
8582.  
The partnership or S corporation doesn’t have a  
record of your prior year unallowed losses from  
!
CAUTION  
the passive activities of the partnership or S  
corporation. If you had prior year unallowed losses from  
these activities, they can be found in column (c) of your  
2022 Part VIII.  
New grouping. You must file a written statement with  
your original income tax return for the first tax year in  
which two or more activities are originally grouped into a  
single activity. The statement must provide the names,  
addresses, and employer identification numbers (EINs), if  
applicable, for the activities being grouped as a single  
activity. In addition, the statement must contain a  
declaration that the grouped activities make up an  
appropriate economic unit for the measurement of gain or  
loss under the passive activity rules.  
Addition to an existing grouping. You must file a  
written statement with your original income tax return for  
the tax year in which you add a new activity to an existing  
group. The statement must provide the name, address,  
and EIN, if applicable, for the activity that’s being added  
and for the activities in the existing group. In addition, the  
statement must contain a declaration that the activities  
make up an appropriate economic unit for the  
measurement of gain or loss under the passive activity  
rules.  
Regrouping. You must file a written statement with your  
original income tax return for the tax year in which you  
regroup the activities. The statement must provide the  
names, addresses, and EINs, if applicable, for the  
activities that are being regrouped. If two or more activities  
are being regrouped into a single activity, the statement  
must contain a declaration that the regrouped activities  
make up an appropriate economic unit for the  
measurement of gain or loss under the passive activity  
rules. In addition, the statement must contain an  
explanation of the material change in the facts and  
circumstances that made the original grouping clearly  
inappropriate.  
Passive Activity Income  
To figure your overall gain or loss from all passive  
activities or any passive activity, take into account only  
passive activity income. Don’t enter income that isn’t  
passive activity income on Form 8582.  
Passive activity income includes all income from  
passive activities (with certain exceptions described in  
Temporary Regulations section 1.469-2T(c)(2) and  
Regulations section 1.469-2(c)(2)), including gain from  
the disposition of an interest in a passive activity and from  
the disposition of property used in a passive activity at the  
time of the disposition.  
Passive activity income doesn’t include the following.  
Income from an activity that isn’t a passive activity.  
Portfolio income, including interest (other than  
self-charged interest treated as passive activity income,  
discussed later), dividends, annuities, and royalties not  
derived in the ordinary course of a trade or business, and  
gain or loss from the disposition of property that produces  
portfolio income or is held for investment (see section  
163(d)(5)). See Temporary Regulations section  
1.469-2T(c)(3).  
Alaska Permanent Fund dividends.  
Personal service income, including salaries, wages,  
commissions, self-employment income from trade or  
business activities in which you materially participated for  
the tax year, deferred compensation, taxable social  
security and other retirement benefits, and payments from  
partnerships to partners for personal services. See  
Temporary Regulations section 1.469-2T(c)(4).  
Income from positive section 481 adjustments allocated  
to activities other than passive activities. See Temporary  
Regulations section 1.469-2T(c)(5).  
Passive Activity Income and  
Deductions  
Income or gain from investments of working capital.  
Income from an oil or gas property if you treated any  
Take into account only passive activity income and  
passive activity deductions to figure your net income or  
net loss from all passive activities or any passive activity.  
loss from a working interest in the property for any tax  
year beginning after 1986 as a nonpassive loss under the  
rule excluding working interests in oil and gas wells from  
passive activities (see item 3 under Activities That Are Not  
Passive Activities, earlier). See Regulations section  
1.469-2(c)(6).  
If your passive activity is reported on Schedule C, E, or  
F, and the activity has no prior year unallowed losses or  
any gain or loss from the disposition of assets or an  
interest in the activity, take into account only the passive  
activity income and passive activity deductions from the  
activity to figure the amount to enter on Form 8582.  
Any income from intangible property if your personal  
efforts significantly contributed to the creation of the  
property.  
Any income treated as not from a passive activity under  
If you own an interest in a passive activity through a  
partnership or an S corporation, the partnership or S  
corporation will generally provide you with the net income  
or net loss from the passive activity. If, however, the  
partnership or S corporation must state an item of gross  
Temporary Regulations section 1.469-2T(f) and  
Regulations section 1.469-2(f). See Recharacterization of  
Passive Income, later.  
Instructions for Form 8582 (2023)  
-7-  
   
Overall gain from any interest in a PTP (see item 2  
Losses from dispositions of property that produce  
portfolio income or property held for investment.  
later).  
State, local, and foreign income taxes.  
Charitable contribution deductions.  
State, local, and foreign income tax refunds.  
Income from a covenant not to compete.  
Net operating loss deductions, percentage depletion  
Any reimbursement of a casualty or theft loss included  
carryovers under section 613A(d), and capital loss  
carryovers.  
in income as recovery of all or part of a prior year loss  
deduction if the deduction for the loss wasn’t treated as a  
passive activity deduction.  
Deductions and losses that would’ve been allowed for  
tax years beginning before 1987, but for basis or at-risk  
limitations.  
Cancellation of debt income to the extent that at the  
time the debt was discharged, the debt wasn’t properly  
allocable under Temporary Regulations section 1.163-8T  
to passive activities.  
Net negative section 481 adjustments allocated to  
activities other than passive activities. See Temporary  
Regulations section 1.469-2T(d)(7).  
Deductions for losses attributable to a federally  
Recharacterization of Passive Income  
declared disaster.  
The deduction allowed for the deductible part of  
Certain income from passive activities must be  
recharacterized and excluded from passive activity  
income. The amount of income recharacterized equals  
the net income from the sources given below. If during the  
tax year you received net income from any of these  
sources (either directly or through a partnership or an S  
corporation), see Pub. 925 to find out how to report net  
income or loss from these sources. For more information,  
see Temporary Regulations section 1.469-2T(f) and  
Regulations section 1.469-2(f).  
self-employment taxes.  
Self-Charged Interest  
Certain self-charged interest income or deductions may  
be treated as passive activity gross income or passive  
activity deductions if the loan proceeds are used in a  
passive activity. Generally, self-charged interest income  
and deductions result from loans between you and a  
partnership or S corporation in which you had a direct or  
indirect ownership interest. This includes both loans you  
made to the partnership or S corporation and loans the  
partnership or S corporation made to you. It also includes  
loans from one partnership or S corporation to another  
partnership or S corporation if each owner in the  
borrowing entity has the same proportional ownership  
interest in the lending entity.  
Income from the following sources may be subject to  
the net income recharacterization rules.  
Significant participation passive activities defined in  
item 4 under Tests for individuals, earlier.  
Rental of property if less than 30% of the unadjusted  
basis of the property is subject to depreciation.  
Passive equity-financed lending activities.  
Rental of property incidental to a development activity.  
Rental of property to a nonpassive activity.  
The self-charged interest rules don’t apply to your  
interest in a partnership or S corporation if the entity made  
an election under Regulations section 1.469-7(g) to avoid  
the application of these rules. For more details on the  
self-charged interest rules, see Regulations section  
1.469-7.  
Acquisition of an interest in a pass-through entity that  
licenses intangible property.  
Passive Activity Deductions  
To figure your overall gain or overall loss from all passive  
activities or any passive activity, take into account only  
passive activity deductions.  
Former Passive Activities  
A former passive activity is any activity that was a passive  
activity in a prior tax year but is not a passive activity in the  
current tax year. A prior year unallowed loss from a former  
passive activity is allowed to the extent of current year  
income from the activity.  
Passive activity deductions include all deductions from  
activities that are passive activities for the current tax year  
and all deductions from passive activities that were  
disallowed under the PAL rules in prior tax years and  
carried forward to the current tax year. See Regulations  
section 1.469-1(f)(4).  
If current year net income from the activity is less than  
or equal to the prior year unallowed loss, enter the prior  
year unallowed loss and any current year net income from  
the activity on Form 8582.  
Passive activity deductions include any loss from a  
disposition of property used in a passive activity at the  
time of the disposition and any loss from a disposition of  
less than your entire interest in a passive activity. See  
Dispositions, later, for the treatment of losses upon  
disposition of your entire interest in an activity.  
If current year net income from the activity is more than  
the prior year unallowed loss from the activity, enter the  
prior year unallowed loss and the current year net income  
up to the amount of prior year unallowed loss on Form  
8582.  
Passive activity deductions don’t include the following.  
Deductions for expenses (other than interest expense)  
If the activity has a net loss for the current year, enter  
the prior year unallowed loss (but not the current year  
loss) on Form 8582.  
that are clearly and directly allocable to portfolio income.  
Qualified home mortgage interest, capitalized interest  
expenses, and other interest expenses (except  
self-charged interest treated as a passive activity  
deduction (discussed next) and interest expenses  
properly allocable to passive activities).  
To report a disposition of a former passive activity,  
follow the rules under Dispositions next.  
-8-  
Instructions for Form 8582 (2023)  
     
1040), you report a total loss of $15,450, which includes a  
current year $2,800 net loss and a $12,650 prior year  
unallowed loss. You have an overall gain from the  
disposition ($15,525 – $15,450 = $75).  
Because you had an overall gain, you make the  
following entries in Part IV. You enter the $15,525 gain on  
the disposition in column (a), the current year loss of  
$2,800 in column (b), and the prior year unallowed loss of  
$12,650 in column (c).  
Example 2. Activity with overall loss. You sell your  
entire interest in an oil and gas limited partnership that  
was your only passive activity for a gain of $2,000. You  
have a current year Schedule E loss of $3,330 and a  
Schedule E prior year unallowed loss of $1,115.  
Because you have an overall loss of $2,445 after  
combining the gain and losses, none of the amounts are  
entered on Form 8582.  
Dispositions  
Disposition of an Entire Interest  
If you disposed of your entire interest in a passive activity  
or a former passive activity to an unrelated person in a  
fully taxable transaction during the tax year, your losses  
allocable to the activity for the year aren’t limited by the  
PAL rules.  
A fully taxable transaction is a disposition in which you  
recognize all realized gain or loss.  
If you’re using the installment method to report this kind  
of disposition, figure the loss for the current year that isn’t  
limited by the PAL rules by multiplying your overall loss  
(which doesn’t include losses allowed in prior years) by  
the following fraction:  
Gain recognized in the current year  
You enter the net loss plus the prior year unallowed  
loss ($3,330 + $1,115 = $4,445) on Schedule E, Part II,  
column (i), and the $2,000 gain on the sale on Form 8949,  
in either Part I or Part II, depending on how long you held  
the partnership interest.  
Unrecognized gain as of the beginning of the current  
year  
A partner in a PTP isn’t treated as having disposed of  
an entire interest in an activity of a PTP until there’s an  
entire disposition of the partner's interest in the PTP.  
Disposition of Less Than an Entire Interest  
Gains and losses from the disposition of less than an  
entire interest in an activity are treated as part of the net  
income or net loss from the activity for the current year.  
Reporting an Entire Disposition on Form 4797 or  
Form 8949  
If you completely dispose of your entire interest in a  
passive activity or a former passive activity, you may have  
to report net income or loss and prior year unallowed  
losses from the activity. All the net income and losses are  
reported on the forms and schedules normally used.  
A disposition of less than substantially all of an  
entire interest doesn’t trigger the allowance of  
!
CAUTION  
prior year unallowed losses.  
Disposition of Substantially All of an Activity  
You may treat the disposition of substantially all of an  
activity as a separate activity if you can prove with  
reasonable certainty:  
Combine all income and losses (including any prior  
year unallowed losses) from the activity for the tax year to  
see if you have an overall gain or loss.  
1. The prior year unallowed losses, if any, allocable to  
the part of the activity disposed of; and  
If you have an overall gain, report the income, losses,  
and prior year unallowed losses in Part IV or V.  
2. The net income or loss for the year of disposition  
allocable to the part of the activity disposed of.  
If you have an overall gain and this is a former passive  
activity, report all income and losses (including any prior  
year unallowed losses) on the forms and schedules  
normally used and don’t use Form 8582.  
Specific Instructions  
Part I—2023 Passive Activity Loss  
If you have an overall loss when you combine the  
income and losses, don’t use Form 8582 for the activity.  
All losses (including prior year unallowed losses) are  
allowed in full. Report the income and losses on the forms  
and schedules normally used.  
Use Part I to combine the net income and net loss from all  
passive activities to determine if you have a passive  
activity loss (PAL) for 2023. Use Parts IV and V first to  
determine the entries for lines 1 and 2 of Part I, as follows.  
Use Part IV for rental real estate activities with active  
participation.  
Use Part V for all other passive activities.  
An overall loss from an entire disposition of a passive  
activity is a nonpassive loss if you have an aggregate loss  
from all other passive activities. When figuring your  
modified adjusted gross income for Part II, line 6, of Form  
8582, be sure to take into account the overall loss from  
the disposition of the activity.  
Line 3. If you have prior year unallowed CRD from rental  
real estate activities, treat that dollar amount as negative  
and combine with lines 1d and 2d. Enter the combined  
amount on line 3 and enter “CRD” and the dollar amount  
of the CRD (as a negative) on the dotted line.  
Example 1. Activity with overall gain. You sell your  
entire interest in a rental real estate activity in which you  
actively participated for a gain of $15,525. $7,300 of the  
gain is section 1231 gain reported on Form 4797,  
Note. If you included prior year unallowed CRD from  
rental real estate activities in line 3, and line 3 is a loss and  
line 1d is zero or more, go to the instructions for Part II,  
line 9, later.  
Part I, and $8,225 is ordinary recapture income reported  
on Form 4797, Part II. On line 22 of Schedule E (Form  
Instructions for Form 8582 (2023)  
-9-  
     
If you need additional lines for any of the Parts IV  
through IX, you can either attach copies of the  
applicable pages of Form 8582, or your own  
If you have prior year unallowed CRD from passive  
activities other than rental real estate activities, include  
that amount in Part V. Add "CRD" after the name of the  
activity.  
Column (a). Enter the current year net income for each  
activity. Enter the total of column (a) on Part I, line 2a, of  
Form 8582. (See the example under Column (a) for Part  
IV, earlier.)  
Column (b). Enter the current year net loss for each  
activity. Enter the total of column (b) on Part I, line 2b, of  
Form 8582. (See the example under Column (b) for Part  
IV, earlier.)  
TIP  
schedule that’s in the same format as the applicable  
part(s).  
Part IV  
Individuals and qualifying estates who actively  
participated in rental real estate activities must include the  
income or loss from those activities in Part IV to figure the  
amounts to enter on Part I, lines 1a through 1c, of Form  
8582.  
Don’t enter a prior year unallowed loss in column (c) of  
Part IV unless you actively participated in the activity in  
both the year the loss arose and the current tax year. If  
you didn’t actively participate in both years, enter the prior  
year unallowed loss in column (c) of Part V.  
Column (c). Enter the unallowed losses for the prior  
years for each activity. You find these amounts in Part VII,  
column (c), of your 2022 Form 8582. Enter the total of  
column (c) from your 2023 Part V on Part I, line 2c, of  
Form 8582.  
Columns (d) and (e). Combine income and losses in  
columns (a) through (c) for each activity, and either enter  
the overall gain for the activity in column (d) or enter the  
overall loss for the activity in column (e). Don’t enter  
amounts from columns (d) and (e) in Parts I, II, or III of  
Form 8582. These amounts will be used when the rest of  
Form 8582 is completed to figure the loss allowed for the  
current year.  
Married individuals who file separate returns and  
lived with their spouses at any time during the tax  
!
CAUTION  
year don’t qualify under the active participation  
rule and must use Part V instead of Part IV.  
Column (a). Enter the current year net income from each  
activity. Enter the total of column (a) on Part I, line 1a, of  
Form 8582.  
Example. A Schedule E rental activity has current year  
profit of $5,000 and a Form 4797 gain of $2,000. You  
enter $7,000 in column (a).  
Column (b). Enter the current year net loss for each  
activity. Don’t enter any prior year unallowed losses in this  
column. Enter the total of column (b) on Part I, line 1b, of  
Form 8582.  
If an activity has net income on one form or schedule  
and a net loss on another form or schedule, report the net  
amounts separately in columns (a) and (b) of Part IV.  
Example. A Schedule E rental activity has current year  
income of $1,000 on line 21 of Schedule E and a current  
year Form 4797 loss of $4,500. You enter $1,000 in  
column (a) and $4,500 in column (b).  
Column (c). Enter the prior year unallowed losses for  
each activity. You find these amounts in Part VII, column  
(c), of your 2022 Form 8582. Enter the total of column (c)  
from your 2023 Part IV on Part I, line 1c, of Form 8582.  
Columns (d) and (e). Combine income and losses in  
columns (a) through (c) for each activity, and either enter  
the overall gain for the activity in column (d) or enter the  
overall loss for the activity in column (e). Don’t enter  
amounts from columns (d) and (e) in Parts I, II, or III of  
Form 8582. These amounts will be used when the rest of  
Form 8582 is completed to figure the loss allowed for the  
current year.  
Part II—Special Allowance for Rental  
Real Estate Activities With Active  
Participation  
If your filing status is married filing separately and  
you lived with your spouse at any time during the  
!
CAUTION  
year, you are not eligible for the special  
allowances in Part II. Do not complete Part II. Instead, go  
to Part III of Form 8582. See the instructions for Part  
Use Part II to figure the maximum amount of rental loss  
allowed if you have an overall loss on Part I, line 1d, from  
your rental real estate activities you actively participated in  
during 2023.  
Note. If you included prior year unallowed CRD from  
rental real estate activities in line 3, first figure the special  
$25,000 allowance for losses from rental real estate  
activities with active participation from Part I, line 1d, if  
any, without regard to the CRD, by completing lines 4  
through 8. To apply any remaining portion of the $25,000  
allowance to prior year unallowed CRD from rental real  
estate activities, see the instructions for line 9.  
If you’re claiming both the premium tax credit  
(PTC) and self-employed health insurance  
!
CAUTION  
deduction (SEHID) and Part I, lines 1d and 3, of  
Form 8582 are both losses, see Self-Employed Health  
Insurance Deduction and PTC in Pub. 974. You’ll have to  
complete worksheets in Pub. 974 before you complete  
Part II of Form 8582.  
Part V  
Use Part V to figure the amounts to enter on Part I, lines  
2a through 2c, for:  
Passive trade or business activities,  
Passive rental real estate activities that don’t qualify for  
Enter all numbers in Part II as positive amounts (that is,  
greater than zero).  
the special allowance, and  
Rental activities other than rental real estate activities.  
-10-  
Instructions for Form 8582 (2023)  
       
Example. Part II, line 4, has a loss of $42,000  
(reported as a positive amount) and line 8 is $25,000. You  
enter $25,000 on line 9 (the smaller of line 4 or line 8, both  
treated as positive amounts).  
Line 8. Don’t enter more than $12,500 on line 8 if you’re  
married filing a separate return and you and your spouse  
lived apart at all times during the year.  
Line 9. If you do not have prior year unallowed CRD from  
rental real estate activities, enter the smaller of line 4 or  
line 8 on line 9.  
If you have prior year unallowed CRD from rental real  
estate activities included in line 3 of Part I, and you have a  
loss on line 1d and line 3 of Part I, first figure the special  
$25,000 special allowance for losses from rental real  
estate activities with active participation, without regard to  
the CRD, by completing lines 4 through 8, then go to the  
Worksheet below. If line 1d of Part I is zero or more, and  
line 3 is a loss, complete the Worksheet below and enter  
the result on line 9 as described below.  
The remaining portion of the $25,000 allowance, if any,  
is available for the prior year unallowed CRD from rental  
real estate activities. Use the Worksheet to figure the  
maximum amount of prior year unallowed CRD allowed  
from rental real estate activities.  
Worksheet for Special Allowance for Prior  
Unallowed Commercial Revitalization Deductions  
From Rental Real Estate Activities  
Note. If you included prior year unallowed CRD from  
rental real estate activities in line 3, and line 3 is a loss and  
line 1d is a loss, complete lines 4 through 8, then see the  
instructions for line 9 below. If line 1d of Part I is zero or  
more, and line 3 is a loss, go directly to the instructions for  
line 9 below.  
Line 4. Enter on line 4 the smaller of the loss on Part I,  
line 1d, or the loss on line 3.  
Example. Part I, line 1d, has a loss of $3,000 and  
line 2d has a gain of $100. The combined loss on line 3 is  
$2,900. You enter $2,900 as a positive number on Part II,  
line 4 (the smaller of the loss on Part I, line 1d, or the loss  
on line 3).  
Line 5. Married persons filing separate returns who lived  
apart from their spouses at all times during the year must  
enter $75,000 on line 5 instead of $150,000.  
Line 6. To figure modified adjusted gross income,  
combine all the amounts used to figure adjusted gross  
income except don’t take into account:  
Enter all numbers in this calculation as positive amounts (greater than  
zero)  
Passive income or loss included on Form 8582,  
Any rental real estate loss allowed to real estate  
A. Enter $25,000* reduced by the amount, if any, of the  
professionals (defined under Activities That Are Not  
Passive Activities, earlier),  
$
$
smaller of Part II, line 4 or line 8 . . . . . . . . . . . . . . . . . . .  
Any overall loss from a PTP,  
B. Enter the loss from Part I, line 3 . . . . . . . . . . . . . . . . .  
The taxable amount of social security and tier 1 railroad  
C. Reduce line B by the amount of the smaller of Part II,  
line 4 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
retirement benefits,  
$
Deductible contributions to traditional individual  
D. Enter the smallest of the amount of the prior unallowed  
CRD (as a positive amount), the amount on line A, or the  
amount on line C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
retirement accounts (IRAs) and section 501(c)(18)  
pension plans,  
$
The deduction allowed for the deductible part of  
* Enter $12,500 (reduced by the amount, if any, of the smaller of Part II, line 4  
or line 8) on line A if you’re married but filing a separate return and you and  
your spouse lived apart at all times during the year.  
self-employment taxes,  
The exclusion from income of interest from series EE  
and I U.S. savings bonds used to pay higher education  
expenses,  
The exclusion of amounts received under an  
Combine line D with the smaller of line 4 or line 8 and  
enter the combined amount on line 9. Enter “CRD” and the  
dollar amount of the special allowance for CRD on the  
dotted line.  
employer's adoption assistance program,  
The student loan interest deduction, or  
The deduction allowed for foreign-derived intangible  
income and global intangible low-taxed income.  
Include in modified adjusted gross income any portfolio  
income and expenses that are clearly and directly  
allocable to portfolio income. Also include any income  
that’s treated as nonpassive income, such as overall gain  
from a PTP and net income from an activity or item of  
property subject to the recharacterization of passive  
income rules.  
When figuring modified adjusted gross income, include  
any overall loss from the entire disposition of a passive  
activity (considered a nonpassive loss).  
Example. Your adjusted gross income on line 11 of  
Form 1040 or Form 1040-SR is $92,000 and you have  
taxable social security benefits of $5,500 on line 6b. Your  
modified adjusted gross income is $86,500 ($92,000 –  
$5,500).  
Part III—Total Losses Allowed  
Use Part III to figure the amount of the losses from all  
passive activities (as determined in Part I) allowed for  
2023.  
Line 11. Use Parts IV through IX of Form 8582 and the  
related instructions to figure the unallowed loss to be  
carried forward and the allowed loss to report on your  
forms and schedules for 2023.  
Parts IV and V  
Parts IV and V, columns (d) and (e), show whether an  
activity had an overall gain or loss. If you have activities  
that show overall gain in column (d) of Parts IV or V, report  
all the income and losses listed in columns (a), (b), and (c)  
for those activities on the proper forms and schedules,  
including Form 8582.  
Instructions for Form 8582 (2023)  
-11-  
       
If you have activities that show an overall loss in  
column (e) of Parts IV or V, you must allocate your  
allowed loss on Part III, line 11, of Form 8582 to those  
activities by completing Parts VI, VII, plus VIII and/or IX.  
enter the results in column (c). The total of column (c)  
must be the same as Part II, line 9, of Form 8582.  
If there is prior year unallowed CRD included in Part II,  
line 9:  
Complete Part VI only if you entered an amount (other  
than zero) on Part II, line 9, of Form 8582. Otherwise, skip  
Part VI and complete Part VII for all activities in Part IV or  
V that have overall losses in column (e) and any amount  
of prior year unallowed CRD included in line 3.  
1. For the Part VI for rental real estate activities with  
active participation, multiply each ratio in column (b) by  
the lesser of line 4 or line 8; and  
2. For the Part VI for prior year unallowed CRD,  
multiply each ratio in column (b) by the amount from line D  
of the Worksheet in the instructions for line 9 above.  
Part VI  
The total of column (c) for the Part VI for rental real estate  
activities with active participation should be the same as  
the lesser of line 4 or line 8, Part II, and the total of column  
(c) for the second Part VI for prior year unallowed CRD  
should be the amount from line D of the Worksheet.  
Column (c) total is the same as column (a) total. If  
the total losses in column (c) are the same as those in  
column (a), the losses in Part IV (or, in the case of the  
second Part VI for prior unallowed CRD, the additional  
amount listed in Part I, line 3) are allowed in full and aren’t  
carried over to Part VII. Report all amounts in columns (a),  
(b), and (c) of Part IV on the proper forms and schedules.  
Column (c) total is less than column (a) total. If the  
total losses in column (c) are less than the total losses in  
column (a), complete column (d).  
Use Part VI to allocate the special allowance on Part II,  
line 9, of Form 8582 among your rental real estate  
activities.  
If you used the Worksheet in the instructions for line 9  
to apply any remaining special allowance to prior year  
unallowed CRD from one or more rental real estate  
activities, complete a separate Part VI to allocate that  
portion of the special allowance to those CRD activities.  
In the first column of Part VI, enter the name of each  
activity. In the second column, enter the form or schedule  
and line number on which the loss will be reported.  
Example. You receive a Schedule K-1 from  
partnership P that reports losses from two rental real  
estate activities, Activity X and Activity Y. The losses from  
partnership P are reported on line 28A of Schedule E. In  
the first two columns of Part VI, enter:  
Column (d). Subtract column (c) from column (a) and  
enter the results in column (d). Also enter the amounts  
from column (d) of Part VI in column (a) of Part VII.  
Name of Activity  
Activity X  
Form or Schedule  
Sch E, line 28A  
Sch E, line 28A  
Part VII—Allocation of Unallowed Losses  
Complete Part VII if any activities have an overall loss in  
column (e) of Part V or losses in column (d) of Part VI (in  
column (e) of Part IV and any prior year unallowed CRD  
included in Part I, line 3, if you didn’t have to complete  
Part VI).  
Activity Y  
If the loss from an activity is reported in more than one  
place, identify both locations in the second column (for  
example, Sch E, line 28A/Form 4797, line 2). If you need  
additional space, show this information on an attached  
statement.  
If you entered an amount on Part II, line 9, and there is  
no amount included in line 9 from prior year disallowed  
CRD, list in Part VI all activities with an overall loss in  
column (e) of Part IV.  
On Part VII, enter the name of each activity and the  
form or schedule and line number on which the loss will  
be reported. See the Example for Part VI. If you have prior  
year unallowed CRD from a passive activity other than  
rental real estate in Part V, and/or unallowed losses for  
prior year CRD from a rental real estate activity in Part VI,  
column (d), add “CRD” after the name of each of the  
activities.  
If you also included an amount for prior year unallowed  
CRD from rental real estate activities in line 9, complete  
another Part IV for these CRD activities. You can use  
another Part IV or your own schedule in the same format  
as Part IV. Enter the prior year unallowed CRD for each  
activity in column (a) of the second Part IV. Then follow  
the instructions for column (b) and column (c) below for  
each Part IV.  
Column (a). Enter the amounts, if any, from column (d)  
of Part VI (from column (e) of Part IV and any prior year  
unallowed CRD included in Part I, line 3, if you didn’t have  
to complete Part VI). Also enter the losses, if any, from  
column (e) of Part V.  
Column (b). Divide each of the individual losses shown  
in column (a) by the total of all the losses in column (a)  
and enter this ratio for each activity in column (b). The  
total of all the ratios must equal 1.00.  
Column (a). Enter the overall loss from column (e) of  
Part IV for each activity.  
Column (c). Complete the following computation.  
Column (b). Divide each of the individual losses shown  
in column (a) by the total of all the losses in column (a),  
and enter this ratio for each activity in column (b). The  
total of all the ratios in column (b) must equal 1.00.  
Column (c). Multiply each ratio in column (b) by the  
amount on Part II, line 9, of Form 8582, if there is no prior  
year unallowed CRD from rental real estate activities, and  
-12-  
Instructions for Form 8582 (2023)  
 
the forms and schedules normally used, subject to any  
further limitations described in Coordination With Other  
Limitations, earlier.  
A. Enter as a positive amount  
Part I, line 3, of Form 8582  
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B. Enter Part II, line 9, of  
Form 8582  
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See the forms and schedules listed under How To  
C. Subtract line B from  
line A  
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Part IX—Activities With Losses Reported on Two  
or More Forms or Schedules  
Multiply each ratio in column (b) by the amount on line  
C above, and enter the result in column (c).  
Use Part IX for any activity listed in Part VII that has losses  
that are reported on two or more different forms and  
schedules or are identified separately on the same form or  
schedule (for example, 28% rate and non-28%-rate  
capital losses reported on Form 8949). Part IX allocates  
the allowed and unallowed loss for the activity and  
allocates the allowed loss to the different forms or  
schedules (or where identified separately on the same  
form or schedule) used to report the losses.  
Parts VIII and IX  
Parts VIII and IX figure your unallowed and allowed losses  
for each activity.  
If you have losses from any activity that are reported on  
two or more different forms or schedules, use Part IX  
instead of Part VIII for that activity.  
Also use Part IX instead of Part VIII for any activity with  
two or more transactions that are reported on the same  
form or schedule but must be separately identified for tax  
purposes. Transactions that must be separately identified  
include capital losses that are 28% rate losses and those  
that aren’t.  
Only losses that would cause a difference in tax liability  
if they were reported on a different form or schedule or are  
identified separately on the same form or schedule are  
kept separate. Those forms, schedules, and parts are the  
following.  
Schedules C, E, and F.  
Note. 28% rate gain or loss includes all collectibles gains  
and deductible long-term losses and section 1202 gain on  
the sale of qualified small business stock. See the  
Instructions for Schedule D for details.  
Form 8949 (Parts I and II (28% rate losses and  
non-28%-rate losses)).  
Note. You must generally make a separate entry in Form  
8949, Part I or Part II, for each transaction reported. See  
the Instructions for Form 8949.  
Part VIII—Allowed Losses  
Forms 4684 (Section B), 4797 (Parts I and II), and  
Use Part VIII for any activity listed in Part VII if all the loss  
from that activity is reported on one form or schedule and  
no transactions need to be identified separately (as  
discussed in Part IX, later). Also see Identification of  
Disallowed Passive Activity Deductions in Pub. 925 for  
more information.  
Example. You will report all the allowed loss from an  
activity listed in Part VII on Schedule E. Use Part VIII to  
determine the allowed loss, even if part of the loss is a  
current year Schedule E loss and part of it is a prior year  
unallowed Schedule E loss.  
4835.  
Use a separate copy of Part IX for each activity for  
which you have losses reported on two or more different  
forms or schedules or which are identified separately on  
the same form or schedule.  
In Part IX, enter the form or schedule and line number  
on the dotted line above each line 1a (for example,  
Schedule D, line 12, to report a long-term capital loss from  
a partnership).  
Line 1a, column (a). Enter the net loss plus any prior  
year unallowed loss from the activity that’s reported on the  
same form or, in the case of Form 4797 and Form 8949,  
the same part.  
If you have a Form 8949 28% rate loss and a Form  
8949 non-28%-rate loss, see Example of Form 8949  
transactions, later, before completing Part IX.  
Line 1b, column (a). Enter any net income from the  
activity that’s reported on the same form or schedule (or  
on the same part of the same form or schedule) as the  
loss on line 1a, column (a).  
Example. You enter a prior year unallowed loss from  
Form 4797, Part I, on line 1a. If the activity has a current  
year Form 4797, Part I, gain, enter the gain on line 1b,  
column (a). If the activity doesn’t have a Form 4797, Part I,  
gain, enter -0- on line 1b, column (a).  
In Part VIII, enter the name of each activity and the form  
or schedule and line number on which the loss is reported.  
Identify each CRD from Part VII on a separate line of Part  
VIII and add "CRD" after the name of the activity. See the  
Example for Part VI.  
Column (a). For each activity entered in Part VIII, enter  
the net loss plus the prior year unallowed loss for the  
activity. Figure this amount by adding the losses in  
columns (b) and (c) of Parts IV and V and any prior year  
unallowed CRD included in Part I, line 3.  
Column (b). For each activity entered in Part VIII, enter  
the amount from column (c) of Part VII for the activity.  
These are your unallowed losses for 2023. Keep a record  
of these amounts so the losses can be used to figure your  
PAL next year.  
Column (c). Subtract column (b) from column (a). These  
amounts are the losses allowed for 2023 under the  
passive loss rules. Report the amounts in this column on  
Column (b). Subtract line 1b, column (a), from line 1a,  
column (a), and enter the result in column (b). If line 1b,  
Instructions for Form 8582 (2023)  
-13-  
 
column (a), is more than line 1a, column (a), enter -0- in  
column (b).  
Column (c). Divide each of the losses entered in column  
(b) by the total of column (b) and enter the ratio in column  
(c). The total of this column must be 1.00.  
Column (d). Multiply the unallowed loss for this activity,  
found in Part VII, column (c), by each ratio in column (c) of  
Part IX. If -0- is entered in column (b) of Part IX, also enter  
-0- for that form or schedule in column (d).  
The amount in column (d) is the unallowed loss for  
2023. Keep a record of Part IX so you can use the losses  
to figure your PAL next year.  
Unallowed losses for Activity I are the following.  
28% rate loss: 0.25 x $3,130 = $782.50.  
Non-28%-rate loss: 0.75 x $3,130 = $2,347.50.  
Allowed losses for Activity I are the following.  
28% rate loss: $1,000 − $782.50 = $217.50.  
Non-28%-rate loss: $3,000 − $2,347.50 = $652.50.  
The total loss allowed for Activity I ($870) is entered in  
Part II of Form 8949. The allowed 28% rate loss ($217.50)  
is entered on the 28% Rate Gain Worksheet (see the  
instructions for Schedule D, line 18). Keep a record of the  
unallowed 28% rate and non-28%-rate losses to figure the  
PAL for next year.  
See the forms and schedules listed under How To  
Column (e). Subtract the amount in column (d) from the  
loss entered on line 1a, column (a). This amount is the  
loss allowed for 2023 under the passive loss rules. Report  
the amounts in this column on the forms or schedules  
normally used, subject to any further limitations described  
in Coordination With Other Limitations, earlier. The forms  
and schedules you use must show the losses from this  
column and the income, if any, for that activity from  
column (a) of Part IV or Part V.  
How To Report Allowed Losses  
Line 3 is income. If Part I, line 3, of Form 8582 shows  
net income or zero, all the losses in columns (b) and (c) of  
Parts IV and V and any prior year unallowed CRD  
included in line 3 are allowed in full under the passive loss  
rules. Report the income and losses in columns (a), (b),  
and (c) of Parts IV and V and any prior year unallowed  
CRD included in line 3 on the forms and schedules  
normally used.  
Example of Form 8949 transactions. The taxpayer  
had the following Form 8949 transactions from passive  
activities in 2023.  
Line 11 is the same as the total of Part I, lines 1b, 1c,  
2b, 2c, and CRD included in line 3. In this case, all the  
losses in columns (b) and (c) of Parts IV and V and any  
prior year unallowed CRD included in line 3 are allowed in  
full under the passive loss rules. Report the income and  
losses in columns (a), (b), and (c) of Parts IV and V on the  
forms and schedules normally used.  
Columns (a) and (c) of Part VI are the same amount.  
In this case, all the losses in columns (b) and (c) of Part IV  
and any prior year unallowed CRD included in line 3 are  
allowed in full under the passive loss rules. Report the  
income and losses in columns (a), (b), and (c) of Part IV  
and any prior year unallowed CRD included in line 3 on  
the forms and schedules normally used.  
Losses allowed in column (c) of Part VIII. The  
amounts in column (c) of Part VIII are the losses or  
deductions allowed for 2023 for the activities listed in that  
part. Report the loss allowed from column (c) of Part VIII  
and the income, if any, for that activity from column (a) of  
Part IV or V on the form or schedule normally used.  
Activity I  
A passive activity prior year unallowed long-term  
capital loss (a 28% rate loss) of $1,000 and a current year  
long-term capital loss (a non-28%-rate loss) of $3,000.  
Activity II  
A current year collectibles loss (a 28% rate loss) of  
$230 and net income of $1,100 from Schedule E (Form  
1040).  
Part V  
Activity I has an overall loss of $4,000 (current year  
long-term capital loss of $3,000 and a prior year  
unallowed long-term capital loss of $1,000). Activity II has  
an overall gain of $870 (current year net income of $1,100  
less a current year long-term capital loss of $230). Part III,  
line 11, of Form 8582 shows an allowed loss of $1,100.  
Since Activity II has an overall gain, the amounts shown  
in columns (a) and (b) of Part V for that activity are  
reported on the proper forms and schedules and aren’t  
shown in any other part.  
Part VII  
Losses allowed in column (e) of Part IX. The amounts  
in column (e) of Part IX are the losses or deductions  
allowed for 2023 for the activity listed on that part. Report  
the losses allowed from column (e) of Part IX and the  
income, if any, for that activity from column (a) of Part IV  
or V on the forms or schedules normally used.  
Schedules C and F, and Form 4835. Enter on the net  
profit or loss line of your Schedule C or F, or line 34c of  
Form 4835, the allowed passive loss from the part. To the  
left of the entry space, enter “PAL.”  
Activity I has an unallowed loss of $3,130 (Part I, line 3,  
of Form 8582 ($3,130) less the sum of Part II, line 9, of  
Form 8582 (-0-) x 100%).  
Part IX  
Part IX is used to figure the portion of the unallowed  
loss attributable to the 28% rate loss and the portion  
attributable to the non-28%-rate loss.  
The loss attributable to the 28% rate loss ($1,000) and  
the loss attributable to the non-28%-rate loss ($3,000) are  
separate entries in Part IX. The ratio of each loss to the  
total of the two losses is figured as follows. $1,000/$4,000  
= 0.25 and $3,000/$4,000 = 0.75. Each of these ratios is  
multiplied by the unallowed loss for Activity I, shown in  
column (c) of Part VII ($3,130).  
If the net profit or loss line on your form or schedule  
shows net profit for the year, reduce the net profit by the  
allowed loss from Part VIII or IX and enter the result on the  
net profit or loss line.  
-14-  
Instructions for Form 8582 (2023)  
   
Example. Schedule C shows net profit for the year of  
$5,000 from a passive activity. The activity also has a  
Form 4797 gain of $2,500 and a prior year unallowed  
Schedule C loss of $6,000. The loss allowed for 2023 is  
$6,000. You enter a net loss of $1,000 on line 31 of  
Schedule C (the $5,000 net profit for the year less the  
$6,000 loss allowed for the year). To the left of the entry  
space, you enter “PAL.”  
Entire disposition with an overall gain. Gains and  
losses from this activity were included on Form 8582 so  
that the gains might offset other PALs. Report all the gains  
and losses on the forms and schedules normally used,  
and to the left of the entry space, enter “EDPA.”  
Publicly Traded Partnerships (PTPs)  
A PTP is a partnership whose interests are traded on an  
established securities market or are readily tradable on a  
secondary market (or its substantial equivalent).  
See Form 4797 and Form 8949, later, if you also had  
passive gains and losses from the sale of assets or of an  
interest in a passive activity.  
An established securities market includes any national  
securities exchange and any local exchange registered  
under the Securities Exchange Act of 1934 or exempted  
from registration because of the limited volume of  
Schedule E, Part I. Enter the allowed loss from the part  
on line 22 of Schedule E. An activity that has net profit for  
the year and prior year unallowed losses will have net  
profit on line 21 and the allowed loss on line 22. The  
allowed loss on line 22 will include the loss allowed to the  
extent of the net profit. Line 24 of Schedule E will show  
total profit and line 25 will show total losses allowed (both  
passive and nonpassive). Line 26 will show the total net  
profit or loss.  
transactions. It also includes any over-the-counter market.  
A secondary market generally exists if a person stands  
ready to make a market in the interest. An interest is  
treated as readily tradable if the interest is regularly  
quoted by persons, such as brokers or dealers, who are  
making a market in the interest.  
Schedule E, Parts II and III. Any item of income shown  
on your Schedule K-1 that’s passive income must be  
entered as passive income in the appropriate column of  
Schedule E, Part II or III. Enter the passive loss allowed  
from Part VIII or IX of Form 8582 in the appropriate  
column for passive losses. The passive losses allowed  
include the loss allowed to the extent of any net income  
from the activity. Passive net income or loss reportable in  
Schedule E, Part II, includes any self-charged interest  
income and deductions treated as passive activity income  
and deductions. See Self-Charged Interest, earlier.  
See Form 4797 and Form 8949, later, if you also had  
passive gains or losses from the sale of assets or of an  
interest in a passive activity.  
Form 4684, Section B. Any passive activity gain from  
Form 4684 is unchanged. It was used on Form 8582 to  
determine allowable PALs. If you don’t have passive  
losses on Form 4684, complete Form 4684 and follow the  
instructions for that form for where to report the gain.  
The substantial equivalent of a secondary market  
exists if there’s no identifiable market maker, but holders  
of interests have a readily available, regular, and ongoing  
opportunity to sell or exchange interests through a public  
means of obtaining or providing information on offers to  
buy, sell, or exchange interests. Similarly, the substantial  
equivalent of a secondary market exists if prospective  
buyers and sellers have the opportunity to buy, sell, or  
exchange interests in a timeframe and with the regularity  
and continuity that the existence of a market maker would  
provide.  
Special Instructions for PTPs  
Section 469(k) provides that the passive activity  
limitations must be applied separately to items from each  
PTP. PALs from a PTP may generally be used only to  
offset income or gain from passive activities of the same  
PTP. The special allowance for rental real estate activities  
(including CRDs) doesn’t apply to PALs from a PTP.  
Passive activity loss rules for partners in PTPs. Don’t  
report passive income, gains, or losses from a PTP on  
Form 8582. Instead, use the following rules to figure and  
report your income, gains, and losses from passive  
activities you held through each PTP you owned during  
the tax year.  
1. Combine any current year income, gains and  
losses, and any prior year unallowed losses to see if you  
have an overall loss from the PTP. Include only the same  
types of income and losses you would include to figure  
your net income or loss from a non-PTP passive activity.  
If you have passive losses on Form 4684, cross  
through the amount you first entered on line 31, 32, 38a,  
38b, or 39 of that form, and enter the allowed loss from  
the part. To the left of the entry space, enter “PAL.”  
Form 4797 and Form 8949. If you sold assets from a  
passive activity or you sold an interest in your passive  
activity, all gains from the activity must be entered on the  
appropriate line of Form 4797 or Form 8949. Identify the  
gain as “FPA.” Enter any allowed losses for Form 4797 or  
Form 8949 on the appropriate line. On Form 8949, include  
“PAL” in the description of the property in column (a). On  
Form 4797, enter “PAL” to the left of the entry space (for  
example, line 2 or line 10).  
Entire disposition with an overall loss. If you made an  
entire disposition of your interest in a passive activity and  
that activity had an overall loss, none of the gains, if any,  
or losses were entered on Form 8582. However, all the  
gains and losses must be reported on the forms or  
schedules normally used. To the left of the entry space,  
enter “EDPA.”  
2. If you have an overall gain, the net gain portion  
(total gain minus total losses) is nonpassive income.  
It’s important to figure the nonpassive income because  
it must be included in modified adjusted gross income to  
figure the special allowance for active participation in a  
non-PTP rental real estate activity on Form 8582. Also,  
you may be able to include the nonpassive income in  
investment income when figuring your investment interest  
expense deduction. See Form 4952, Investment Interest  
Expense Deduction.  
Instructions for Form 8582 (2023)  
-15-  
     
Report all gains and allowed losses from the activity on  
the forms or schedules normally used, and to the left of  
each entry space, enter “From PTP.”  
(c) of Part VIII (column (e) of Part IX) are the allowed  
losses to report on your forms or schedules. Report these  
losses and any income from the PTP on the forms and  
schedules normally used.  
Example. You have Schedule E income of $8,000 and  
a Form 4797 prior year unallowed loss of $3,500 from the  
passive activities of a PTP. You have a $4,500 overall  
gain ($8,000 − $3,500) that’s nonpassive income. On  
Schedule E, Part II, you report the $4,500 net gain as  
nonpassive income in column (k). In column (h), you  
report the remaining Schedule E gain of $3,500 ($8,000 −  
$4,500) as passive income. On the appropriate line of  
Form 4797, you report the prior year unallowed loss of  
$3,500. You enter “From PTP” to the left of each entry  
space.  
3. If you have an overall loss (but didn’t dispose of  
your entire interest in the PTP to an unrelated person in a  
fully taxable transaction during the year), the losses are  
allowed only to the extent of the income, and the excess  
loss is carried forward to use in a future year if you have  
income to offset it. Report as a passive loss on the  
schedule or form you normally use the portion of the loss  
equal to the income. Report the income as passive  
income on the form or schedule you normally use.  
4. If you have an overall loss and you disposed of your  
entire interest in the PTP to an unrelated person in a fully  
taxable transaction during the year, your losses (including  
prior year unallowed losses) allocable to the activity for  
the year aren’t limited by the passive loss rules. A fully  
taxable transaction is one in which you recognize all your  
realized gain or loss. Report the income and losses on the  
forms and schedules normally used.  
For rules on the disposition of an entire interest  
reported using the installment method, see Disposition of  
an Entire Interest, earlier.  
Paperwork Reduction Act Notice. We ask for the  
information on this form to carry out the Internal Revenue  
laws of the United States. You are required to give us the  
information. We need it to ensure that you are complying  
with these laws and to allow us to figure and collect the  
right amount of tax.  
You are not required to provide the information  
requested on a form that is subject to the Paperwork  
Reduction Act unless the form displays a valid OMB  
control number. Books or records relating to a form or its  
instructions must be retained as long as their contents  
may become material in the administration of any Internal  
Revenue law. Generally, tax returns and return  
Example. You have a Schedule E loss of $12,000  
(current year losses plus prior year unallowed losses) and  
Form 4797 gain of $7,200 from the passive activities of a  
PTP. You report the $7,200 gain on the appropriate line of  
Form 4797. On Schedule E, Part II, you report $7,200 of  
the losses as a passive loss in column (g). You carry  
forward the unallowed loss of $4,800 ($12,000 − $7,200).  
If you have unallowed losses from more than one  
activity of the PTP or from the same activity of the PTP  
that must be reported on different forms or schedules,  
allocate the unallowed losses on a pro rata basis to figure  
the amount allowed for each activity or on each form or  
schedule.  
information are confidential, as required by section 6103.  
The time needed to complete and file this form will vary  
depending on individual circumstances. The estimated  
burden for individual taxpayers filing this form is approved  
under OMB control number 1545-0074 and is included in  
the estimates shown in the instructions for their individual  
income tax return. The estimated burden for all other  
taxpayers who file this form is shown below.  
To allocate and keep a record of the unallowed  
losses, use Parts VII, VIII, and IX of Form 8582.  
TIP  
Recordkeeping. . . . . . . . . . . . . . . . . .  
Learning about the law or the form . .  
Preparing the form. . . . . . . . . . . . . . .  
26 min.  
22 min.  
List each activity of the PTP in Part VII. Enter the overall  
loss from each activity in column (a). Complete column (b)  
of Part VII according to its instructions. Multiply the total  
unallowed loss from the PTP by each ratio in column (b)  
and enter the result in column (c) of Part VII.  
Next, complete Part VIII for each activity listed in Part  
VII if all the loss from that activity is reported on one form  
or schedule. Use Part IX instead of Part VIII for each  
activity with losses reported on two or more different  
forms or schedules (or are identified separately on the  
same form or schedule). Enter the net loss plus any prior  
year unallowed losses in column (a) of Part VIII (or line 1a,  
column (a), of Part IX, if applicable). The losses in column  
1 hr., 52 min.  
Copying, assembling, and sending  
the form to the IRS . . . . . . . . . . . . . . .  
48 min.  
If you have comments concerning the accuracy of  
these time estimates or suggestions for making this form  
simpler, we would be happy to hear from you. See the  
instructions for the tax return with which this form is filed.  
-16-  
Instructions for Form 8582 (2023)