During the current year, Harry earned investment income of $18,500.In addition, he incurred investment interest expense of $15,500 and other investment expenses of $9,000.Harry may deduct $9,500 of investment interest expense this year and carry forward $6,000 to future years.

Question

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Harry may deduct up to the amount of his investment income ($18,500) plus $1,000, which is $19,500. Since he is only deducting $9,500 this year, he may carry forward the remaining $6,000 to future years.

During the Current Year, Harry Earned Investment Income of $18,500