Homework Answers
Deductible rental loss is $6,650
Explanation:
| Description | Amount | Explanation | |
| (1) | Maximum
deduction available Before phase-out |
$25,000 | |
| (2) |
Phase-out of Maximum deduction |
$23,450 | [($146,900 AGI - $100,000) X 0.5] |
| (3) | Maximum
deduction in current year |
$1,550 | (1)-(2) |
| (4) | Rental
loss in Current year |
$8,200 | |
| (5) | Rental
loss deductible in current year |
$1,550 | Lesser of (3) or (4) |
Anwer meets the definition of an "active participant" and has adjusted gross income of less than $150,000, before considering his rental loss.So that he may deduct $1,550 of the loss against other income.
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