B. After applying the S1231 five year look back rule , $40,000 is ordinary income and $10,000 is long-term capital gain.
Year | Net S1231 Gain(loss) |
Recaptured/nonrecaptured S1231 losses |
Notes | Ordinary | LTCG |
Year 1 | ($65,000) |
$0 ($65,000) |
Loss is ordinary Non recaptured losses |
($65,000) | |
Year 2 | $15,000 |
$15,000 ($50,000) |
Gain is ordinary Non recaptured losses |
$15,000 | |
Year 3 | $0 |
$0 ($50,000) |
Nonrecaptured losses |
||
Year 4 | $0 |
$0 ($50,000) |
Nonrecaptured losses |
||
Year 5 | $10,000 |
$10,000 ($40,000) |
Gain is ordinary Nonrecaptured losses |
$10,000 | |
Year 6 | $50,000 |
$40,000 $10,000 |
Gain is ordinary No nonrecaptured losses |
$40,000 | $10,000 |
____×____
All the best
Required information Problem 3-54 (LO 3-5) [The following information applies to the questions displayed below.] Part...
00 Required information Problem 3-54 (LO 3-5) [The following information applies to the questions displayed below.] Part 1 of 2 Hans runs a sole proprietorship. Hans has reported the following net $1231 gains and losses since he began business. Net $1231 gains shown are before the look-back rule. (Leave no answer blank. Enter zero if applicable.) points Net $1231 Gains/(Losses) $(65,000) 15,000 Year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 (current year) Print...
Required Information [The following information applies to the questions displayed below.] Hans runs a sole proprietorship. Hans has reported the following net $1231 gains and losses since he began business. Net $1231 gains shown are before the look back rule. (Leave no answer blank. Enter zero If applicable.) Net $1231 Gains/(Losses) $(68,500) 16,750 Year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 (current year) 11,400 51,750 b. Assume that the $51,750 net $1231 gain...
Required information [The following information applies to the questions displayed below. Hans runs a sole proprietorship. Hans has reported the following net §1231 gains and losses since he began business. Net 1231 gains shown are before the lookback rule. (Leave no answer blank. Enter zero if applicable.) Net s1231 Gains/ (Losses) $ (71,500) Year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 (current year) 18,250 12,600 53,250 a. What amount, if any, of the...
a)What amount, if any, of the year 7 (current year) $50,000 net 1231 gain is treated as ordinary income? b) Assume that the $50,000 net 1231 gain occurs in year 6 instead of year 7. What amount of the gain would be treated as ordinary income in year 6? Saved Required information Problem 3-54 (LO 3-5) The following information applies to the questions displayed below. of Hans runs a sole proprietorship. Hans has reported the following net 51231 gains and...
Problem 3-52 (LO 3-5) [The following information applies to the questions displayed below.] Tonya Jefferson (single), a sole proprietor, runs a successful lobbying business in Washington, DC. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse, from which she runs her business, to buy a place somewhere sunny and warm. Tonya's townhouse is worth $1,000,000 and the land is worth another $1,000,000. The original basis in the townhouse was $600,000, and she...
Required information Problem 3-52 (LO 3-5) [The following information applies to the questions displayed below.) Tonya Jefferson (single), a sole proprietor, runs a successful lobbying business in Washington, DC. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse, from which she runs her business, to buy a place somewhere sunny and warm. Tonya's townhouse is worth $1,000,000 and the land is worth another $1,000,000. The original basis in the townhouse was $600,000,...
Required information (The following information applies to the questions displayed below.) Bourne Guitars, a corporation, reported a $157,000 net $1231 gain for year 6. a. Assuming Bourne reported $50,000 of nonrecaptured net $1231 losses during years 1-5, what amount of Bourne's net $1231 gain for year 6, if any, is treated as ordinary income? Bourne's gain treated as ordinary income
Required information (The following information applies to the questions displayed below.) Bourne Guitars, a corporation, reported a $157,000 net $1231 gain for year 6. b. Assuming Bourne's nonrecaptured net $1231 losses from years 1-5 were $200,000, what amount of Bourne's net $1231 gain for year 6, if any, is treated as ordinary income? Bourne's gain treated as ordinary income
Problem 3-52 (LO 3-5) [The following information applies to the questions displayed below.) Tonya Jefferson (single), a sole proprietor, runs a successful lobbying business in Washington, DC. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse, from which she runs her business, to buy a place somewhere sunny and warm. Tonya's townhouse is worth $1,000,000 and the land is worth another $1,000,000. The original basis in the townhouse was $600,000, and she...
The answer is not $217,500.00 Required information [The following information applies to the questions displayed below.] Tonya Jefferson (single), a sole proprietor, runs a successful lobbying business in Washington, DC. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse, from which she runs her business, to buy a place somewhere sunny and warm. Tonya's townhouse is worth $1,000,000 and the land is worth another $1,000,000. The original basis in the townhouse was...