In 2013, Jenny had a $12,000 net short-term capital loss and deducted $3,000 as a capital loss deduction. In 2014, Jenny has a $18,000 0%/15%/20% long-term capital gain and no other capital gain or loss transactions. Which of the statements below is correct?

Question

Quizplus · Accepted Answer

The $12,000 net short-term capital loss from 2013 can be carried over to 2014, reducing the $18,000 long-term capital gain to $6,000 ($18,000 - $12,000). Since the long-term capital gain is greater than the $3,000 capital loss deduction, Jenny can use the entire deduction, resulting in a net capital gain of $3,000 ($6,000 - $3,000). Therefore, option B is correct, and the remaining options are incorrect.

In 2013, Jenny Had a $12,000 Net Short-Term Capital Loss