This year, Jack O. Lantern incurred a $60,000 loss on the worthlessness of his stock in the Creepy Corporation (CC). The stock, which Jack purchased in 2005, met all of the §1244 stock requirements at the time of issue. In December of this year, Jack's wife, Jill, also incurred a $75,000 loss on the sale of Eerie Corporation (EC) stock that she purchased in July 2005 and which also satisfied all of the §1244 stock requirements at the time of issue. Both corporations are operating companies. Assume that they file a joint return. a. How much of the losses incurred on the two stock sales can Jack and Jill deduct this year, assuming they do not have capital gains in the current or prior years? > Answer is complete but not entirely Total deductible loss $ 100,000 ×

This year, Jack O. Lantern incurred a $60,000 loss on the worthlessness of his stock in the Creepy Corporation (CC). The stock, which Jack purchased in 2005, met all of the §1244 stock requirements at the time of issue. In December of this year, Jack's wife, Jill, also incurred a $75,000 loss on the sale of Eerie Corporation (EC) stock that she purchased in July 2005 and which also satisfied all of the §1244 stock requirements at the time of issue. Both corporations are operating companies. Assume that they file a joint return. a. How much of the losses incurred on the two stock sales can Jack and Jill deduct this year, assuming they do not have capital gains in the current or prior years? > Answer is complete but not entirely Total deductible loss $ 100,000 ×

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter7: Losses—deductions And Limitations

Section: Chapter Questions

Problem 56P

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This year, Jack O. Lantern incurred a $75,000 loss on the worthlessness of his stock in the Creepy Corporation (CC). The stock, which Jack purchased in 2005, met all of the §1244 stock requirements at the time of issue. In December of this year, Jack’s wife, Jill, also incurred a $80,900 loss on the sale of Eerie Corporation (EC) stock that she purchased in July 2005 and which also satisfied all of the §1244 stock requirements at the time of issue. Both corporations are operating companies. Assume that they file a joint return. 1. How much of the losses incurred on the two stock sales can Jack and Jill deduct this year, assuming they do not have capital gains in the current or prior years? 2. Assuming they did not engage in any other property transactions this year, how much of a net capital loss will carry over to next year for Jack and Jill? 3.What would be the tax treatment for the losses if Jack and Jill reported only $66,250 of taxable income this year, excluding the securities…
This year, Jack O. Lantern incurred a $75,000 loss on the worthlessness of his stock in the Creepy Corporation (CC). The stock, which Jack purchased in 2005, met all of the §1244 stock requirements at the time of issue. In December of this year, Jack's wife, Jill, also incurred a $80,900 loss on the sale of Eerie Corporation (EC) stock that she purchased in July 2005. Jill's purchase also satisfied all of the §1244 stock requirements at the time of issue. Both corporations are operating companies. Assume that they file a joint return. c. What would be the tax treatment for the losses if Jack and Jill reported only $66,250 of taxable income this year, excluding the securities transactions?
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answer must be correct or i will give down vote
am. 133.
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