Ms. Cowler owns stock in Serzo Inc., an S corporation, and an interest in OTW Partnership. This year, Ms. Cowler had the following income and loss items. $\begin{array}{llr}
\text { Salary } &\$66,800\
\text { Interest and dividends} &1,200\
\text { Business loss from Serzo } &\$(19,400)\
\text { Business income from OTW } &\$17,000
\end{array}$
If Ms. Cowler's interests in Serzo and OTW are passive activities, compute her AGI.

Question

Ms. Cowler owns stock in Serzo Inc., an S corporation, and an interest in OTW Partnership. This year, Ms. Cowler had the following income and loss items. $\begin{array}{llr}
  \text { Salary } &\$66,800\
 \text { Interest and dividends} &1,200\
 \text { Business loss from Serzo } &\$(19,400)\
 \text { Business income from OTW } &\$17,000
\end{array}$
 If Ms. Cowler's interests in Serzo and OTW are passive activities, compute her AGI.

Quizplus · Accepted Answer

Ms. Cowler's AGI is $68,000. This is calculated by adding her salary and interest and dividends, and then subtracting her business loss from Serzo. Her business income from OTW is not included in her AGI because it is a passive activity.

Ms Cowler Owns Stock in Serzo Inc If Ms Cowler's Interests in Serzo and OTW Are Passive Activities