In 2010,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?
A)In 2010,Glenda can deduct $97,000 for regular income tax purposes and for AMT purposes.
B)Glenda will have a $97,000 tax preference in 2010 as a result of the passive activity.
C)For regular income tax purposes,none of the loss is allowed in 2010.
D)In 2010,Glenda will have a positive adjustment of $25,000 as a result of the passive loss.
E)None of the above.

Question

Quizplus · Accepted Answer

For regular income tax purposes, passive activity losses can only be deducted to the extent of passive activity income. Since Glenda has no other passive activities, none of the loss is allowed in 2010.

In 2010,Glenda Had a $97,000 Loss on a Passive Activity