Question

Oriole Corporation has active income of $45,000 and a passive loss of $23,000 in the current year. Under an exception, Oriole can deduct the $23,000 loss if it is a personal service corporation.

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Answer 1

Oriole Corporation cannot deduct the passive loss of $23,000 if it is a personal service corporation.

Step-by-step explanation:

The subject of this question is Business.

Oriole Corporation has active income of $45,000 and a passive loss of $23,000 in the current year. The student wants to know if Oriole can deduct the $23,000 loss if it is a personal service corporation.

No, Oriole cannot deduct the $23,000 loss if it is a personal service corporation. Personal service corporations are not eligible for the exception that allows the deduction of passive losses. They can only deduct active income and passive income, not passive losses.