If a capital asset is sold at a loss,the holding period is not important.

Question

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The holding period is important when calculating the tax implications of a capital asset sale. If the asset was held for less than a year, it is considered a short-term capital loss and can only be used to offset short-term capital gains or up to $3,000 of ordinary income. If the asset was held for more than a year, it is considered a long-term capital loss and can be used to offset long-term capital gains or up to $3,000 of ordinary income. So, the holding period is important in determining the tax implications of a capital asset sale.

If a Capital Asset Is Sold at a Loss,the Holding