In 2014,Carmen had a net capital loss of $10,000 and taxable income of $100,000.What is Carmen's loss carryforward to 2015?

Question

Quizplus · Accepted Answer

According to the tax laws, a taxpayer can offset capital losses against capital gains and up to $3,000 of ordinary income each year. As Carmen had a net capital loss of $10,000 and taxable income of $100,000, she can offset $3,000 of her ordinary income, reducing it to $97,000. This also leaves her with a net capital loss of $7,000 ($10,000 - $3,000), which she can carry forward to the next tax year. Therefore, her loss carryforward to 2015 is $7,000.

In 2014,Carmen Had a Net Capital Loss of $10,000 and Taxable