George Grant runs a hot dog stand. During the year, he sells an oven and a refrigerator that were used in his business and held for ﬁve years. He had a gain of $500 on the oven and a loss of $1,000 on the refrigerator. If these are his only sales or exchanges during the tax year, George will treat the gain as long-term capital gain and the loss as long-term capital loss.

Question

Quizplus · Accepted Answer

the re would be 1231 gain of $500 (ignoring any depreciation recapture) and a 1231 loss of $1,000 which would be treated when netted as a net loss which would be ordinary.

George Grant Runs a Hot Dog Stand