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18 October, 22:20

Brent files a return as married filing jointly. In 2019, he had the following items: • Salary of $104,000. • Loss of $105,000 on the sale of § 1244 stock acquired two years ago. • Interest income of $8,000. Brent's capital loss carryforward is:

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  1. 18 October, 22:38
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    Brent's capital loss carry forward is $2,000.

    Explanation:

    The long term capital loss os computed as:

    Long term capital loss = Loss - $100,000 {limitation of $100,000}

    = $105,000 - $100,000

    = $5,000

    Of this amount, only $3,000 is the limitation of the capital losses against the ordinary income.

    So, the capital loss carry forward is computed as:

    =$5,000 - $3,000

    = $2,000
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