chpt 7 HW solutions

chpt 7 HW solutions - Individual Tax Accounting – 2011...

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Unformatted text preview: Individual Tax Accounting – 2011 edition Chapter 7 Homework Solutions 36. Sell all of the stock in the current year: Current year’s AGI Salary $ 80,000 Ordinary loss (§ 1244 limit) (50,000) Long-term capital gain $8,000 Long-term capital loss ($80,000 – $50,000) (30,000) Long-term capital loss (limit) (3,000) AGI $ 27,000 Next year’s AGI Salary $ 90,000 Long-term capital gain $10,000 Long-term capital loss carryover ($30,000 – $11,000) (19,000) Long-term capital loss (limit) (3,000) AGI $ 87,000 Total AGI Current year $ 27,000 Next year 87,000 Total $114,000 Sell half of the stock this year and half next year: Current year’s AGI Salary $ 80,000 Ordinary loss (§ 1244 stock) (40,000) Long-term capital gain 8,000 AGI $ 48,000 Next year’s AGI Salary $ 90,000 Ordinary loss (§ 1244 stock) (40,000) Long-term capital gain 10,000 AGI $ 60,000 Total AGI Current year $ 48,000 Next year 60,000 Total $108,000 Mary’s combined AGI for the two years is lower if she sells half of her § 1244 stock this...
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This note was uploaded on 12/22/2010 for the course BUSACC 1242 taught by Professor Staff during the Spring '10 term at Pittsburgh.

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chpt 7 HW solutions - Individual Tax Accounting – 2011...

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