Harvey rents his second home.During 2018,Harvey reported a net loss of $35,000 from the rental.If Harvey is an active participant in the rental and his AGI is $80,000,how much of the loss can he deduct against ordinary income in 2018?

Question

Quizplus · Accepted Answer

An active participant in a rental activity can deduct up to $25,000 of losses against ordinary income if the taxpayer's AGI is no more than $100,000. Since Harvey's AGI is $80,000, he can deduct up to $25,000 of the rental loss against ordinary income. Therefore, the correct answer is B) $25,000.

Harvey Rents His Second Home