Alexis has a long-term capital loss of $13,000 on the sale of stock in the current year.She has no other capital gains or losses for the year.Her taxable income without this transaction is $60,000.What is her current year taxable income considering this capital loss?

Question

Quizplus · Accepted Answer

The IRS allows taxpayers to deduct up to $3,000 of capital losses against ordinary income each year. Therefore, Alexis can deduct $3,000 from her $60,000 taxable income, resulting in a taxable income of $57,000. The remaining $10,000 capital loss can be carried forward to future years.

Alexis Has a Long-Term Capital Loss of $13,000 on the Sale