Tom Brown, who is single, owns a rental apartment building property. This is the only rental property that Tom owns. He "actively participates" in this rental activity as he collects the rents and performs ordinary and necessary repairs. In 2004, Tom had a loss of $30,000 on this rental activity and had no reportable passive income. His adjusted gross income, without regard to this rental loss, is $60,000. How much of the rental loss may Tom deduct on his 2004 return?
A)$30,000
B)$25,000
C)$0
D)$6,000

Question

Quizplus · Accepted Answer

$25,000

Tom Brown, Who Is Single, Owns a Rental Apartment Building