Maria, an Engineer, Has Adjusted Gross Income of $167,000 Before

Multiple Choice

Maria, an engineer, has adjusted gross income of $167,000 before considering the following losses. The passive activity rules disallow the deduction for the loss in which of the following?
I.Maria has a $21,000 loss from her ownership of Family Apartment Village, a low-income housing project.
II.Maria owns and actively participates in managing a rental house across the street from East State College. This activity generates a $7,000 loss in the current year.
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A) Only statement I is correct.
B) Only statement II is correct.
C) Both statements are correct.
D) Neither statement is correct.