Mara owns an activity with suspended passive losses from prior years of $13,000. In the current year, Mara becomes a material participant in the activity. This year the activity generates $6,000 of income. The net effect of this activity on Mara's current year AGI is
A) an increase of $6,000.
B) a decrease of $13,000.
C) 0.
D) a decrease of $7,000.
C) 0.
The suspended passive loss will be allowed to offset this year's non-passive income from the activity, but the excess suspended passive loss of $7,000 will carry forward.
You might also like to view...
The sentence "Joe ran in the race." is a
a. simple sentence b. compound sentence c. complex sentence d. compound-complex sentence
It is important to assign a unique number to every component in the project Work Breakdown Structure
Indicate whether the statement is true or false
The liquidity of a company can be measured using the current ratio and the ________, which only includes the most liquid current assets in its calculation.
What will be an ideal response?
Explain the growing presence of knowledge workers in today’s workforce and how these employees differ from traditional workers. Describe the specific issues managers must address when employing knowledge workers.
What will be an ideal response?