For each of the following situations, determine the deduction concepts involved, and explain how they form the basis for the tax treatment described:

a. Jamie sells her personal residence at a loss of $9,000. She is not allowed a deduction for the loss.

b. Jamie sells a building used in her business at a loss of $9,000. She is allowed to deduct a $9,000 loss on the sale of the building.

c. The Orlando Jams Partnership borrows $500,000 to use as working capital. During the current year, the partnership pays $45,000 in interest on the loan and repays $100,000 of the loan principal. Orlando can deduct both the $45,000 interest payment and the repayment of the loan principal.