If a Taxpayer Sells a Passive Activity with Suspended Passive

question 51

Multiple Choice

If a taxpayer sells a passive activity with suspended passive activity losses from prior years, what type of income can be offset by the suspended passive losses in the year of sale?

• A) Passive activity income
• B) Portfolio income
• C) Active business income
• D) Any of these types of income can be offset.
• E) None of these. The suspended losses disappear when the passive activity is sold.

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Definitions:

Reagan Administration's Foreign Policy

The foreign policy strategy of the United States during Ronald Reagan's presidency (1981-1989), characterized by a strong anti-Communist stance and efforts to reduce Cold War tensions.

Domestic Consequences

The internal effects or outcomes within a country as a result of its policies, actions, or events, including social, economic, and political impact.

Disintegration of the Soviet Union

The process that led to the dissolution of the Soviet Union in 1991, resulting in the independence of its 15 republics.

End of the Cold War

The period from the late 1980s through the early 1990s marked by a thaw in relations between the Soviet Union and the United States, leading to the eventual dissolution of the Soviet Union in 1991.