Ferris Owns an Interest In,but Does Not Materially Participate In,an

question 53

Multiple Choice

Ferris owns an interest in,but does not materially participate in,an activity.He has $30,000 at-risk.The business produced a loss in the current year and Ferris's share of the loss is $45,000.Assuming Ferris has no passive income,how much of the $45,000 loss will be deductible by Ferris?

• A)$0.
• B)$30,000.
• C)$45,000.
• D)Cannot be determined.

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Definitions:

Psychokinesis

The purported ability to move or manipulate objects with the mind, without physical interaction, a phenomenon not supported by scientific evidence.

Telepathy

The purported transmission of information from one person to another without using any of our known sensory channels or physical interaction.

Precognition

The alleged ability to see or know about events before they happen.

Motivations

Motivations are the driving forces behind human actions, desires, and needs.