The amount and nature of Erin's capital gains and losses are:
Short term capital losses are first offset with the same type of capital gain (i.e., short term capital gain).
Similarly, long term capital losses are first offset with long term capital gain
Net Losses of one kind then can be offset with other kind of gain.
Hence:
STEP 1:
Net Long-Term Capital Loss=$8900-$1900=$7,000
STEP2
Net Short-Term Capital Gain =25100-14900=$10,200
STEP 3
At this step, the Net Long-Term Capital Loss of $7,000 will be deducted from Net Short-Term Capital Gain of $10,200
Amount of Erin’s Capital gain =SHORT TERM CAPITAL GAIN of (10200-7000) =$3,200
ANSWER: $3,200 net short-term capital gain
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