Wednesday, September 12, 2012

Investment and Passive Activity Interest § 469

Interest is deductible to the extent of the income generated by investments or passive activities. What is passive?


Investment and Passive Activity Interest § 469



A business activity in which the tax payer does not particularly participate. Does not have immediate control. Example: You won property, but aren’t doing anything. If you take out loan to finance passive investing, but only deduct interest to the extent that you are making money. Only to the extent that you have income from the activity

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