$*****$

Passive Activity Losses

Wages: Thomas $($$$45,000)$

Dividend and Interest Income: $$2,000$

Net Loss from Rental Property: $($$$18,000)$

Additional Passive Income $($partnership$)$: $$10,000$

QBI: None

Itemized Deductions: $$17,000$

Allowable deduction for self$-$employment tax: None

Calculate:

AGI, Taxable Income, and Total Tax Liability

Analyze the limitations on passive activity loss deductions.