Fundamentals of Taxation 2011 4th Edition by Ana Cruz, Debra Prendergast, Dan Schisler, Michael Deschamps

Exercise 44

Julia acquired passive Activity A in January 2005 and passive Activity B in July 2007. Until 2008, Activity A was profitable. Activity A produced a loss of $150,000 in 2008 and a loss of $150,000 in 2009. She has passive income from Activity B of $50,000 in 2008, and $35,000 in 2009. How much of the net passive losses may she deduct in 2008 and 2009 respectively (ignore at-risk rules)?