What is a Capital Asset?, Holding Period, Calculation of Gain or Loss, Net Capit
ID: 2535025 • Letter: W
Question
What is a Capital Asset?, Holding Period, Calculation of Gain or Loss, Net Capital Losses (LO 8.1, 8.2, 8.3, 8.5)
Charu Khanna received a Form 1099-B showing the following stock transactions and basis during 2016:
None of the stock is qualified small business stock. The stock basis was reported to the IRS.
Calculate Charu's net capital gain or loss using Schedule D and Form 8949.
Note: If required, enter a "loss" as a negative number on the tax form. Do not enter deductions as negative numbers. If an amount is zero, enter "0". If the answer is "Not applicable", select NA from the drop-down list.
Department of the Treasury Internal Revenue Service (99)
2016
Attachment
Sequence No. 12
If line 16 is a gain, enter the amount from line 16 on Form 1040, line 13, or Form 1040NR, line 14. Then go to line 17 below.
If line 16 is a loss, skip lines 17 through 20 below. Then go to line 21. Also be sure to complete line 22.
If line 16 is zero, skip lines 17 through 21 below and enter -0- on Form 1040, line 13, or Form 1040NR, line 14. Then go to line 22.
The loss on line 16 or
($3,000), or if married filing separately, ($1,500)
Department of the Treasury Internal Revenue Service
? Information about Form 8949 and its separate instructions is at www.irs.gov/form8949.
? File with your Schedule D to list your transactions for lines 1b, 2, 3, 8b, 9, and 10 of Schedule D.
2016
Attachment
Sequence No. 12A
Stock Date
Purchased
Date Sold Sales
Price Cost
Basis 4,000 shares Green Co. 06/04/05 08/05/16 $12,000 $3,000 500 shares Gold Co. 02/12/16 09/05/16 54,000 62,000 5,000 shares Blue Co. 02/04/06 10/08/16 18,000 22,000 100 shares Orange Co. 11/15/15 07/12/16 19,000 18,000
Explanation / Answer
18,000 1,000
-2,000
Stock Date
Purchased
Date Sold Sales
Price Cost
Price Profit OrLoss 4,000 shares Green Co. 06/04/05 08/05/16 $12,000 $3,000 9,000 500 shares Gold Co. 02/12/16 09/05/16 54,000 62,000 -8,000 5,000 shares Blue Co. 02/04/06 10/08/16 18,000 22,000 -4,000 100 shares Orange Co. 11/15/15 07/12/16 19,000
18,000 1,000
-2,000
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