"In 2017, Arnold invests $80,000 for a 20% interest in a partnership in which he is not a material participant. The partnership incurs a loss with $100,000 being Arnold's share. Which of the following statements is incorrect?"

a. Since Arnold has only $80,000 of capital at risk, he cannot deduct any more than thisamount against his other income.

b. Arnolds nondeductible loss of $20,000 can be carried over and used in future years (subject to the at-risk and passive activity loss limitations provisions).

c.If Arnold has taxable income of $40,000 from the partnership in 2017 and there are no other transactions that affect his at-risk amount, he can use all of the $20,000 loss carried over from 2016.

d. Arnolds $100,000 loss is nondeductible in 2016 and 2017 under the passive activityloss provisions.