Tuna,Inc. ,a closely held corporation which is not a PSC,owns a 40% interest in Trout Partnership,which is classified as a passive activity.Trout's taxable loss for the current year is $200,000.During the year,Tuna receives a $60,000 cash distribution from Trout.Other relevant data for Tuna are as follows:

How much of Tuna's share of Trout's loss may it deduct in calculating its taxable income?
A)$0.
B)$25,000.
C)$60,000.
D)$80,000.
E)None of the above.

Question

Tuna,Inc. ,a closely held corporation which is not a PSC,owns a 40% interest in Trout Partnership,which is classified as a passive activity.Trout's taxable loss for the current year is $200,000.During the year,Tuna receives a $60,000 cash distribution from Trout.Other relevant data for Tuna are as follows:

How much of Tuna's share of Trout's loss may it deduct in calculating its taxable income?

How much of Tuna's share of Trout's loss may it deduct in calculating its taxable income?
A)$0. 
B)$25,000. 
C)$60,000. 
D)$80,000. 
E)None of the above.

Quizplus · Accepted Answer

The Answer of Tuna,Inc. ,a closely held corporation which is not a PSC,owns a 40% interest in Trout Partnership,which is classified as a passive activity.Trout's taxable loss for the current year is $200,000.During the year,Tuna receives a $60,000 cash distribution from Trout.Other relevant data for Tuna are as follows:

How much of Tuna's share of Trout's loss may it deduct in calculating its taxable income?
A)$0. 
B)$25,000. 
C)$60,000. 
D)$80,000. 
E)None of the above.

Tuna,Inc ,A Closely Held Corporation Which Is Not a PSC,owns