Daniel is considering selling two stocks that have not performed well over recent years. 6 friend recently informed Danlel that one of his stocks has a special designation, which allows him to treat a loss up to $54,000 on this stock as an ordinary loss rather than the typical capital loss. Daniel figures that he has a loss of $64, 800 on each stock. If Daniel's marginal tax rate is 35 percent and he has $129,600 of other capital gains (taxed at 15 percent), what is the tax savings from the special tax treatment?

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter4: Income Exclusions
Section: Chapter Questions
Problem 86DC: Marlo and Merlins son, Alex, needs 20,000 to start a business. They have 30,000 in securities that...
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Daniel is considering selling two stocks that have not performed well over recent years. 6
friend recently informed Danlel that one of his stocks has a special designation, which allows
him to treat a loss up to $54,000 on this stock as an ordinary loss rather than the typical
capital loss. Daniel figures that he has a loss of $64, 800 on each stock. If Daniel's marginal tax
rate is 35 percent and he has $129,600 of other capital gains (taxed at 15 percent), what is
the tax savings from the special tax treatment?
Transcribed Image Text:Daniel is considering selling two stocks that have not performed well over recent years. 6 friend recently informed Danlel that one of his stocks has a special designation, which allows him to treat a loss up to $54,000 on this stock as an ordinary loss rather than the typical capital loss. Daniel figures that he has a loss of $64, 800 on each stock. If Daniel's marginal tax rate is 35 percent and he has $129,600 of other capital gains (taxed at 15 percent), what is the tax savings from the special tax treatment?
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