In the current year, Julia earns $9,000 in investment income and incurs $14,000 of investment interest expense. What is the maximum amount of investment interest expense she is allowed this year as a from AGI deduction (itemized deduction), and what is her interest expense carryforward, if any?
$0
$5,000 deductible this year, $11,000 carried forward to next year
$9,000 deductible this year, $5,000 carried forward to next year
$14,000 deductible this year; no carryforward