In 2017, Glenn Recorded a $108,000 Loss on a Passive

question 103

Multiple Choice

In 2017, Glenn recorded a $108,000 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 2017, Glenn can deduct $108,000 for regular income tax purposes and for AMT purposes.
• B)Glenn reports a $108,000 tax preference in 2017 as a result of the passive activity.
• C)For regular income tax purposes, none of the passive activity loss is allowed in 2017.
• D)In 2017, Glenn reports a positive adjustment of $25,000 as a result of the passive activity loss.

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Definitions:

Verify

To check or test the accuracy or correctness of something.

Pair of Equations

Represents two equations involving the same variables, often solved simultaneously to find the values of those variables.

Annual Net Income

Annual Net Income refers to the amount of money earned in one fiscal year after all expenses and taxes have been subtracted.

Partnership

A legal form of business operation between two or more individuals who share management and profits or losses.