Question

Maria, a single taxpayer, had losses totaling $30,000 from a rental real estate activity in which she actively participated. Maria also had $15,000 of income from another rental real estate activity in which she actively participated. She acquired both investments in the current year. If Maria has no other passive income and adjusted gross income before passive losses of $70,000, how much loss from rental activities can she use to offset her portfolio and active income?

Answer 1

$25,000

Step-by-step explanation:

The computation of the loss from rental activities is shown below

If there is any loss arise from the real estate with respect to the rental activity so the same would be deducted from the passive income

The losses till $25,000 would be used for offset active or the income of the portfolio

Hence, $25,000 would be the losses