In 2011, Jenny had a $12,000 net short-term capital loss and deducted $3,000 as a capital loss deduction.In 2012, Jenny has a $18,000 0%/15% long-term capital gain and no other capital gain or loss transactions.Which of the statements below is correct?
A)Jenny has a 2012 $18,000 net capital gain.
B)Jenny has a 2012 $9,000 net capital gain.
C)Jenny has a 2012 $9,000 net capital loss.
D)Jenny has a 2012 $3,000 capital loss deduction.
E)Jenny has a 2012 $9,000 capital loss deduction.

Question

Quizplus · Accepted Answer

Jenny's 2011 net short-term capital loss of $12,000 was partially used up in 2011 by deducting $3,000 as a capital loss deduction. This leaves $9,000 of the short-term capital loss to be carried over to 2012. Therefore, in 2012, Jenny's net capital gain would be calculated as follows:
$18,000 (long-term capital gain) - $9,000 (short-term capital loss carried over from 2011) = $9,000 net capital gain in 2012.

In 2011, Jenny Had a $12,000 Net Short-Term Capital Loss