[Stgeorge]

Hi so i came accross this question and what really got me is that they included rental income into the NOL computation which doesnt make sense since it is a passive activity. I am assuming that passive activity gains are included in the NOL computation?

Destry, a single taxpayer, reported the following on his U.S. Individual Income Tax Return (Form 1040):

Income:

Wages $5,000

Interest on savings account 1,000

Net rental income 4,000

Deductions:

Personal exemption $ 4,000

Standard deduction 6,300

Net business loss 16,000

Net short-term capital loss 2,000

What is Destry’s net operating loss that is available for carryback or carryforward?

A.

$7,000

B.

$9,000

C.

$15,700

Incorrect D.

$16,000

FAR 81
AUD 65, 84 (Used Ninja MCQ which I say contributed to my huge increase in score I love you Jeff)
REG 87 (CPA excel Wiley Self Study Book, Ninja 10 point combo)
BEC 86! I Must Pass or I lose my FAR Credit, Pray for me(Becker, Wiley, WTB, Ninja MCQ, Ninja Notes)

DONE!!!!!!

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