The three tax statuses are:

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The three tax statuses are capital asset, ordinary asset, and § 1231 asset. Capital assets are typically held for investment purposes, such as stocks and bonds. Ordinary assets are held for business use, such as inventory or equipment. § 1231 assets are used for business purposes but may be subject to capital gain or loss treatment. Together, these three tax statuses cover most assets and help determine how they are taxed. The other choices are not correct combinations of tax statuses.

The Three Tax Statuses Are