Jana reports the following income and loss: Activities A, B, and C are all passive activities.
Based on this information, Joy has the following suspended losses:

Question

Jana reports the following income and loss:  Activities A, B, and C are all passive activities.
Based on this information, Joy has the following suspended losses:

Quizplus · Accepted Answer

Since all activities are passive, losses can only be used to offset passive income. Activity C has no passive income, so its loss is suspended. Activity A and B each have passive income, so their losses can be used to offset that income. However, if there is any loss left over after offsetting that income, it is suspended. Therefore, the only suspended loss is from Activity C, making answer D the correct choice.

Jana Reports the Following Income and Loss: Activities A