Helen, a single taxpayer, has modified adjusted gross income (before passive losses) of $98,000. During the tax year, Helen’s rental house generated a loss of $27,000. Assuming Helen is actively involved in the management of the property, what is the amount of Helen’s passive loss deduction from the rental house?

SWFT Comprehensive Volume 2019
42nd Edition
ISBN:9780357233306
Author:Maloney
Publisher:Maloney
Chapter15: Taxing Business Income
Section: Chapter Questions
Problem 34P
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Helen, a single taxpayer, has modified adjusted gross income (before passive losses) of $98,000. During the tax year, Helen’s rental house generated a loss of $27,000. Assuming Helen is actively involved in the management of the property, what is the amount of Helen’s passive loss deduction from the rental house?


A. $71,000
B. $25,000
C. $0
D. $27,000
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