11. Jenny is a US individual who qualifies as a real estate professional. She purchases a commercial rental real estate property in 2016 and leases it out. The taxable net loss from the property was ($4,000) in 2016. Jennys only other source of income or loss was $12,000 of interest income from a loan. She sells the real estate in 2017 at a $10,000 gain. How much taxable income and loss should Jenny report in each of the following tax years:

2016 ____________________ 2017 ____________________

Explain what happened (why was this the outcome)

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