During the Current Year, Ethan Performs Personal Services as Follows

question 43

Multiple Choice

During the current year, Ethan performs personal services as follows: 800 hours in his information technology consulting practice, 625 hours in a real estate development business, and 510 hours in a condominium leasing operation. He expects that losses will be realized from the two real estate ventures while his consulting practice will show a profit. Ethan files a joint return with his wife whose salary is $125,000. The income and losses from the following ventures is considered active and not subject to the passive activity loss limitations:

• A)Only the information technology consulting practice.
• B)Only the information technology consulting practice and the real estate development business.
• C)Only the information technology consulting practice and the condominium leasing operation.
• D)All three of the ventures are considered active and not subject to the passive activity loss limitations.
• E)None of the above.

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Definitions:

Low Level of Trust

Refers to situations where there is minimal confidence in the reliability, truth, or ability of someone or something, often hindering cooperation and communication.

Maximize Cohesiveness

Strategies or practices aimed at strengthening the unity and solidarity of a group to achieve common goals.

Norms

Implicit rules and expectations that guide behavior of group members, helping to shape attitudes and actions within a social context.

Informal Rules

Unwritten guidelines or norms governing behavior within a group or organization, which can influence actions and decisions alongside formal regulations.