In 2011,Glenda had a $97,000 loss on a passive activity.None of the loss is attributable to AMT adjustments or preferences.She has no other passive activities.Which of the following statements is correct?

Question

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Glenda cannot currently deduct the passive loss on her tax return for regular income tax purposes because she has no other passive activities to offset the loss against. However, she can carry forward the loss and use it to offset future passive activity income or gains. Option A is incorrect because Glenda cannot deduct the loss for AMT purposes either. Option B is also incorrect because there is no tax preference associated with a passive loss. Option D is incorrect because there is no positive adjustment associated with a passive loss.

In 2011,Glenda Had a $97,000 Loss on a Passive Activity