Pedro Owns a 50% Interest in a Limited Partnership That

Multiple Choice

Pedro owns a 50% interest in a limited partnership that operates an apartment complex. During the current year, the partnership generates a taxable rental loss of $42,000. Pedro's other sources of income are salary of $55,000 and interest of $18,000. What is Pedro's allowable loss from the apartment?

A) $ - 0 -
B) $18,000
C) $21,000
D) $25,000
E) None of the above.