Our tax laws encourage taxpayers to ____ assets that have appreciated in value and ____ assets that have declined in value.
A)sell, keep.
B)sell, sell.
C)keep, sell.
D)keep, keep.
E)None of the above.

Question

Quizplus · Accepted Answer

Tax laws allow taxpayers to deduct losses from their income, so it makes sense to sell assets that have declined in value to take advantage of this deduction. If you sell assets that have appreciated in value, you'll have to pay capital gains tax on the profit, which is why it is generally recommended to keep those assets if possible.

Our Tax Laws Encourage Taxpayers to ____ Assets That Have