Velvet,Inc.,has a 2011 net § 1231 loss of $74,000 and had a $12,000 net § 1231 gain in 2010.For 2011,Velvet's net § 1231 loss is treated as:

Name: Velvet,Inc.,has a 2011 net § 1231 loss of $74,000 and had a $12,000 net § 1231 gain in 2010.For 2011,Velvet's net § 1231 loss is treated as:
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Net § 1231 losses are treated as ordinary losses, regardless of whether there were gains in the previous year. Therefore, Velvet's net § 1231 loss of $74,000 for 2011 will be treated as an ordinary loss.