An Individual Taxpayer Has Negative Taxable Income for the Year

question 33

Multiple Choice

An individual taxpayer has negative taxable income for the year.In calculating the net operating loss created,which of the following expenses or losses will be added back to the negative taxable income?

• A)capital losses
• B)nonbusiness deductions in excess of nonbusiness income
• C)both of the above
• D)none of the above

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Definitions:

Useful Life

Refers to the estimated duration an asset is expected to remain functional and useful for its intended purpose before it requires replacement.

Indefinite Time

Indefinite Time indicates a period without a specified end date.

Research Costs

Expenditures related to activities undertaken to gain new knowledge or understanding to develop new products, processes, or services; often a significant part of a company's innovation efforts.