In the current year, Kelly had a $35,000 loss from a real estate rental activity in which she is a 10% owner. If she is an active participant and if her modified AGI is $100,000 or less, she can deduct $25,000 of the loss.
Answer the following statement true (T) or false (F)
True
Rationale: She meets both the active participation test and the ownership test. Further, Kelly's modified AGI has not reached the level (beyond $100,000) where any of the $25,000 loss is phased out.
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