George is a limited partner in the GLH Partnership. His outside basis is $40,000 before considering the current year items, and includes a $10,000 recourse debt share and a $20,000 nonrecourse debt share. The nonrecourse debt is qualified nonrecourse financing. GLH reported a $200,000 loss for the year, of which George's 40% share is $80,000. George has passive activity income of $50,000 from another activity (not eligible for the special real estate deduction). How much of the $80,000 loss can George deduct this year?

a.$20,000.

b.$30,000.

c.$40,000.

d.$50,000.

e.$80,000.