Suspended losses from a passive activity can be deducted against portfolio and other income if the taxpayer sells his entire interest in the activity,

Question

Quizplus · Accepted Answer

When a taxpayer sells their entire interest in a passive activity, any suspended losses from that activity can be deducted against portfolio and other income in the year of sale. However, if the taxpayer only sells a portion of their interest in the activity, the remaining suspended losses continue to be carried forward until the taxpayer either has taxable income from the activity or fully disposes of their interest in it.

Suspended Losses from a Passive Activity Can Be Deducted Against