Ms. Fresh bought 1,000 shares of Ibis Corporation stock for $5,000 on January 15

Question

Ms. Fresh bought 1,000 shares of Ibis Corporation stock for $5,000 on January 15, 2013. On December 31, 2015 she sold all 1,000 shares of her Ibis stock for $4,500. Based on a hot tip from her friend, she bought 1,000 shares of Ibis stock on January 23, 2016 for $3,000. What is Ms. Fresh's recognized loss on her 2015 sale and what is her basis in her 1,000 shares purchased in 2016?

$-0- LTCL and $3,500 basis

$200 LTCL and $3,300 basis

$300 LTCL and $3,200 basis

$400 LTCL and $3,100 basis

$500 LTCL and $3,000 basis

When calculating net investment income, gross investment income includes:

interest income

net short-term capital gains

non-qualified dividends

royalty income

All of these

Alain Mire files a single tax return and has adjusted gross income of $304,000. His net investment income is $53,000. What is the additional tax that Alain will pay on his net investment income for the year?

Zero

$2,014

$3,952

$1,938

None of these

Explanation / Answer

1) $-0- LTCL and $3,500 basis , If shares are bought back within 30days from the previously purhcase shares sold , then the loss will not be considered, but it will increase the Adjusted basis for new shares purchase

1000 Share purchase = $5000

less: 1000 shares sold = $4500

Realised loss = $500

LTCL = $0

Adjusted basis for new 1000 shares = $3000 + $500(realised loss)

   = $3500

2) All of these, If private companies earned these income(Interest , short term capital gain , dividend and royalty) from the Income's sources are gross investment income

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