Al, who is single, has a gain of $40,000 on the sale of § 1244 stock (small business stock) and a loss of $80,000 on the sale of

Question

olga2289 [7]

3 years ago

14

Al, who is single, has a gain of $40,000 on the sale of § 1244 stock (small business stock) and a loss of $80,000 on the sale of

§ 1244 stock. As a result, Al has a $40,000 ordinary loss. True False

Business

1 answer:

Genrish500 [490] · Answer 1 · 2022-02-15T14:22:57+03:00

Answer:

False

Explanation:

Given that

Gain on the sale = $40,000

And loss on the sale = $40,000

So by considering the above information ,

So, the gain on sale i.e $40,000 would be classified as a capital gain and the $80,000 would be classified as a ordinary loss which is to limited of $50,000

So, the remaining balance i.e

= $50,000 - $40,000

= $10,000

This $10,000 would be term as capital gain

Hence, the given statement is false