In 2014,Glenn had a $108,000 loss on a passive activity.None of the loss is attributable to AMT adjustments or preferences.She has no other passive activities.Which of the following statements is correct?
A)In 2014,Glenn can deduct $108,000 for regular income tax purposes and for AMT purposes.
B)Glenn will have a $108,000 tax preference in 2014 as a result of the passive activity.
C)For regular income tax purposes,none of the loss is allowed in 2014.
D)In 2014,Glenn will have a positive adjustment of $25,000 as a result of the passive loss.
E)None of these.

Question

Quizplus · Accepted Answer

For regular income tax purposes (and for AMT purposes),none of the loss on the passive activity is allowed.Therefore,the passive loss does not cause a difference between taxable income and AMTI.As a result,no AMT adjustment is required.

In 2014,Glenn Had a $108,000 Loss on a Passive Activity