Passive loss carryover from previous years as a partnership. The partnership changed to a LLC which is a corporation where one is a shareholder. If shares are sold, can I use the passive losses?

[Landymore]

I have passive loss carryover from previous years as a partnership. The partnership changed status to a LLC (corporation) where one is now a shareholder. If I sell my shareholder shares, may I take the passive losses from the amount shares are sold on the tax return?

Example: Total of years of passive losses = (100), Sales price of shares = 40.

With an answer of (60).

Can I claim a loss of 60 on the tax return the year the shares are sold?

[Mike9241]

if you completely dispose of all the shares you hold, the entire suspended passive loss is allowed.

A disposition generally occurs if the taxpayer’s entire interest in the activity is disposed of in a fully taxable transaction to an unrelated party (Sec. 469(g)(1)).