Linda owns investments that produce portfolio income and Activity A that produces losses.From a tax perspective, Linda will be better off if Activity A is not passive.

Question

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If Activity A is not passive, Linda may be able to offset her portfolio income with the losses from Activity A, reducing her overall taxable income. However, if Activity A is classified as passive, she may not be able to use the losses to offset her portfolio income.

Linda Owns Investments That Produce Portfolio Income and Activity a That