The passive loss rules apply to closely held C corporations and to personal service corporations but not to S
corporations.

Name: The passive loss rules apply to closely held C corporations and to personal service corporations but not to S corporations.
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Question

Quizplus · Accepted Answer

The passive loss rules do not apply to S corporations because the income and losses pass through to the shareholders, who then apply the passive loss rules at the individual level.

The Passive Loss Rules Apply to Closely Held C Corporations