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Jeff Owned One Passive Activity

question 108

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Jeff owned one passive activity.Jeff sold the activity and realized a $2,000 gain on the sale.Prior to the sale,he realized a current year loss from the activity of $6,000.In addition,he has suspended losses from prior years of $7,000.What is the net impact on Jeff's AGI this year due to the passive activity?


Definitions:

Sub-Contracting

The process of outsourcing specific portions of a project or job to specialized third parties while retaining overall responsibility for completion.

Discount Rate

Employed in discounted cash flow analysis, this interest rate is used for determining the current value of cash flows that will be received in the future.

Annual Payments

Regular payments made once a year, often associated with loan repayments or insurance premiums.

Discount Rate

This is the discount rate used in the process of DCF to calculate the present value of cash flows that are to be received in the future.

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