A married couple files a joint tax return and recognizes a $15,000 net short-ter

Question

A married couple files a joint tax return and recognizes a $15,000 net short-term capital loss and a $9,000 net long-term capital gain during the year. If the couple's only other item of income or deduction is the husband's $82,500 of wages and $2,000 of municipal bond interest, their AGI is:

A. $84,500

B. $81,500 (This was marked incorrect when i submitted)

C. $81,500 (yes, i am aware of the duplicate number, this is how it shows)

D. 79,500 (Edit: This is the correct answer!)

E. None of the above

Explanation / Answer

Solution: $79,500

Working: 82500 - 3000 = 79,500

A deduction can be up to $3,000 per year in net capital losses against the other income. If the net losses is more than this amount, the remainder can be carried over to following years.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.