During the year,Lion Company incurs a $25,000 loss on a passive activity,has active income of $17,000,and portfolio income of $12,000.If Lion is a personal service corporation,it may deduct $17,000 of the $25,000 passive loss.

Question

Quizplus · Accepted Answer

Personal service corporations are not eligible to deduct passive losses. Therefore, Lion Company cannot deduct any portion of the $25,000 passive loss in this scenario.

During the Year,Lion Company Incurs a $25,000 Loss on a Passive