Question: Which of the following statements regarding passive activity losses is CORRECT? When determining the amount of suspended loss that may be used against income, the

Which of the following statements regarding passive activity losses is CORRECT?
When determining the amount of suspended loss that may be used against income, the at-risk rules are applied before the passive activity loss rules.
If a loss is not allowed because of the at-risk limitations, the loss is a suspended loss eligible for deduction as a disposition of a passive activity.

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