Lucy has AGI of $120,000 before considering losses from some rental real estate she owns (she actively participates). She had the following losses from her rental property:
Rental Property #1 ......... ($22,000)
Rental Property #2 ......... ($ 5,000)
a. How much of the losses can Lucy deduct?
b. If Lucy’s AGI before the losses was $90,000, how much of the losses can she deduct?