Josh Has Investments in Two Passive Activities

question 111

Multiple Choice

Josh has investments in two passive activities. Activity A, acquired three years ago, produces income in the current year of $60,000. Activity B, acquired last year, produces a loss of $100,000 in the current year. At the beginning of this year, Josh's at-risk amounts in Activities A and B are $10,000 and $100,000, respectively. What is the amount of Josh's suspended passive activity loss with respect to these activities at the end of the current year?

• A) $0
• B) $36,000
• C) $40,000
• D) $100,000
• E) None of the above

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Definitions:

Direct Benefit Payments

Direct payments from governments to individuals for programs like Social Security, welfare, or subsidies.

Gasoline

A flammable liquid derived from petroleum, used primarily as fuel in internal combustion engines.

Netherlands

A country located in Northwestern Europe, known for its flat landscape, extensive canal systems, tulip fields, windmills, and cycling routes.

Germany

A country in Central Europe known for its rich history, culture, and contributions to the world in various fields like technology, science, and the arts.