Kate recognized a $25,700 net long-term capital gain and a $33,000 net short-term capital loss this year. What is her current net income tax cost or savings from her capital transactions if her marginal rate on ordinary income is 32%?

Question

Quizplus · Accepted Answer

Only $3,000 of Kate's $7,300 net short-term capital loss is deductible, which saves $840 tax ($7,300 × 32%).

Kate Recognized a $25,700 Net Long-Term Capital Gain and a $33,000