Brandon,a single taxpayer,had a loss of $48,000 from a rental real estate activity in which he actively participated.He also had $27,000 of income from another rental real estate activity in which he actively participated.He acquired both investments in the current year.If Brandon has no other passive income or losses and has adjusted gross income of $84,000 before considering passive activities,how much net loss from rental activities can he use to offset his nonpassive income?

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Quizplus · Accepted Answer

Brandon can offset up to $25,000 of nonpassive income with passive losses from rental real estate activities if he actively participates and his AGI is below $100,000. Here, he has a net loss of $21,000 ($48,000 loss - $27,000 income), which is within the $25,000 limit, so he can use the entire $21,000 to offset his nonpassive income.

Brandon,a Single Taxpayer,had a Loss of $48,000 from a Rental