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Betty invests $100,000 for a 25% partnership interest

In 2003, Betty invests $100,000 for a 25% partnership interest in an activity in which she is a material participant. The partnership reports losses of $300,000 in 2003 and $300,000 in 2004. Betty's share of the partnership's losses is $75,000 in 2003 and $75,000 in 2004. How much of the losses from the partnership can Betty deduct?

a. $75,000 in 2003 and $75,000 in 2004.

b. $75,000 in 2003 and $25,000 in 2004.

c. $0 in 2003 and $0 in 2004.

d. $75,000 in 2003 and $0 in 2004.

e. None of the above.

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