investment interest that cannot be deducted in the current y

investment interest that cannot be deducted in the current year because of the \"net investment income\" limitation is A) never deductible B) carried forward 5 years C) carried back three years and forward 5 years D) carried forward to later years subject to limitations

Solution

Interest on investment is not deductible from the operating income becase the interest expenses on investment is for earning the investment and it is not for earning the income from operating of business.

So interest expenses of investment is not related to earn the revenue from operation so never deductible.

Answer = Option A ) Never Deductible