Catfish, Inc

question 80

Multiple Choice

Catfish, Inc., a closely held corporation which is not a PSC, owns a 45% interest in Trout Partnership, which is classified as a passive activity. Trout's taxable loss for the current year is $250,000. During the year, Catfish receives a $60,000 cash distribution from Trout. Other relevant data for Catfish are as follows:
How much of Catfish's share of Trout's loss may it deduct in calculating its taxable income?

• A)$0
• B)$20,000
• C)$45,000
• D)$112,500
• E)None of the above