Garnet has the following capital asset transactions during 2016: Long-term capit

Question

Garnet has the following capital asset transactions during 2016: Long-term capital gain $8,000 Short-term capital gain Further, Garnet has an excess capital loss carryforward of $6,000 from 2015 a. What are the tax consequences of these transactions if the $6,000 loss is long-term and Garnet is an individual? Garnet is a C 3,000 corporation? In 2016, if Garnet is an individual, the result is long-term capital gain taxed at preferential rates and a $ short-term capital gain taxed as ordinary income In 2016, if Garnet is a C corporation, the result is long-term capital gain taxed as ordinary income. Feedback Check My Work Both corporate and noncorporate taxpayers are required to aggregate gains and losses from the taxable sale or exchange of capital assets. b. What are the tax consequences of these transactions if the $6,000 loss is short-term and Garnet is an individual? Garnet is a C corporation? In 2016, if Garnet is an individual, the result is In 2016, if Garnet is a C corporation, the result is long-term capital gaintaxed at preferential rates. long-term capital gainaxed as ordinary income.

Explanation / Answer

a. If he is Individual - 2000 is taxed as long term capital gain at preferntial rates and 3000 taxed as short term capital gain as ordinary income. If he is C Corporation 2000 taxed as long term capital gain taxed as ordinary income.

b. If he is individual - 5000 is taxed as long term capital gain at preferential rates.If he is C Corporation 5000 is taxed as long term capital gain as ordinary income.

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