Cal and Ann Are a Married Couple Filing a Joint

Multiple Choice

Cal and Ann are a married couple filing a joint return. Ann earns a $700,000 salary as a bank executive. The couple has $150,000 of interest and dividend income. Cal is a 50% partner and material participant in CD Partnership. CD has incurred a $1.5 million ordinary loss this year, and Cal's share is $750,000. Cal's basis is large enough to absorb the loss. With respect to the partnership loss, the couple will deduct

A) $750,000.
B) $700,000.
C) $250,000.
D) $500,000.