Question

Creek Corporation had $210,000 of active income, $45,000 of portfolio income, and a $230,000 passive activity loss during the year. If Creek is a closely held C corporation that is not a personal service corporation (PSC), it can deduct $230,000 of the passive activity loss in the year.

Answer 1

Answer:

given statement is false

Explanation:

given data

active income = $210,000

portfolio income = $45,000

passive activity loss = $230,000

deduct passive activity loss = $230,000

solution

as per Topic Passive Activities

we know that Losses and Credits in IRS state here that Loss from passive activity is not allowed for current year

and here this loss will be carry forward to the next taxable year

as a similar rule is applicable to give credits from passive activities

so that given statement is false