at-risk amount

The taxpayer has an amount at risk in a business or investment venture to the extent that it has subjected personal assets to the risks of the business. Typically, the taxpayer's at-risk amount includes
(1) the amount of money or other property that the investor contributed to the venture for the investment,
(2) the amount of any of the entity's liabilities for which the taxpayer personally is liable and that relate to the investment, and
(3) an allocable share of nonrecourse debts incurred by the venture from third parties in arm's length transactions, with respect to real estate investments.

Black's law dictionary. . 1990.

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