Azul Corporation,a personal service corporation,had $450,000 of active income,$65,000 of portfolio income,and a $70,000 passive loss during the year.How much is Azul's taxable income?
A)$380,000.
B)$445,000.
C)$450,000.
D)$515,000.
E)None of the above.

Question

Quizplus · Accepted Answer

A personal service corporation may not offset passive loss against active income or portfolio income.Thus,Azul's taxable income is $515,000 ($450,000 + $65,000).

Azul Corporation,a Personal Service Corporation,had $450,000 of Active Income,$65,000 of Portfolio