Chapter 3 Computing The Tax - Test Bank Town
Combining the long-term transactions yields a net LTCL of $2,000 ($13,000 – $15,000), while the short-term process results in a net STCG of $7,000 ($13,000 – $6,000). A further combination leaves a net STCG of $5,000 ($7,000 – $2,000) which is taxed as ordinary income. Only net LTCG results in preferential tax treatment. ................
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