Martha has a net capital loss of $17,000 and other ordinary taxable income of $45,000 for the current year. What is the amount of Martha's capital loss carryforward?

Question

Quizplus · Accepted Answer

Martha can use $3,000 of her capital loss to offset her other ordinary taxable income ($45,000 - $3,000 = $42,000 taxable income). The remaining $14,000 of the capital loss can be carried forward to future years to offset capital gains or up to $3,000 of ordinary income per year. Therefore, the amount of Martha's capital loss carryforward is $14,000.

Martha Has a Net Capital Loss of $17,000 and Other