Wolf Corporation has active income of $55,000 and a passive activity loss of $33,000 in the current year. Wolf cannot deduct the $33,000 loss if it is a closely held C corporation that is not a personal service corporation

a. True
b. False
Indicate whether the statement is true or false

False
RATIONALE: Closely held C corporations that are not personal service corporations may offset passive activity losses against active income but not against portfolio income.