Alan has the following capital gains and losses during the current year:
$\begin{array}{lc}
\text {Short-term capital loss } &\$(4,000) \
\text {Collectibles gain } &3,000 \
\text {Long-term capital gain } &8,000
\end{array}$
Alan's capital gain/loss position for the year is:
A)Long-term gain $8,000; short-term capital loss $1,000.
B)Net long-term capital gain $7,000.
C)Short-term capital loss $4,000; long-term capital gain $11,000
D)Collectibles gain $3,000; long-term capital gain $4,000

Question

Alan has the following capital gains and losses during the current year:
$\begin{array}{lc}
\text {Short-term capital loss } &\$(4,000) \
\text {Collectibles gain  } &3,000 \
\text {Long-term capital gain  } &8,000
\end{array}$
Alan's capital gain/loss position for the year is:
A)Long-term gain $8,000; short-term capital loss $1,000.
B)Net long-term capital gain $7,000.
C)Short-term capital loss $4,000; long-term capital gain $11,000
D)Collectibles gain $3,000; long-term capital gain $4,000

Quizplus · Accepted Answer

Alan's net capital gain/loss is calculated by offsetting the short-term capital loss against the long-term capital gain and collectibles gain. The net result is a long-term capital gain of $7,000 ($8,000 long-term gain + $3,000 collectibles gain - $4,000 short-term loss).

Alan Has the Following Capital Gains and Losses During the Current