Tax 610-Chapter 12 Solutions-s16 (1) - Tax 610 Individual...

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Tax 610Individual Tax PlanningChapter 12 HW Solutions
#3030.(a), (b), (d) and (g) are capital assets. A gold ring, a personal automobile, shares of stock, and a home are not excluded from the definition of a capital asset. Accounts receivable, buildings, business cars and trucks, and copyrights are all excluded from the capital asset definition.
# 35The basis for loss for Susan is the fair market value on January 8, 2015, which is less than the basis to the donor. If the fair market value is used as the basis, then the holding period also begins on the day following the date of the gift. Therefore, Susan has a short-term capital loss of $900 ($1,500 - $2,400).
#37a. Ed has a net short-term capital loss of $750 ($1,500 - $2,250) and a net long-term capital gain of $3,000 ($5,500 - $2,500). The net capital gain is $2,250 ($3,000 - $750), which is taxed up to a maximum rate of 15/20 percent.b. There is a net amount of $750 included in Ed's adjusted gross income. Ed has a net short-term capital gain of $1,500 ($6,000 - $4,500) and a net long-term capital loss of $750. The net overall capital gain is $750 ($1,500 - $750), which is taxed as ordinary income up to a maximum rate of 39.6 percent.

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