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Adam is an individual taxpayer who has these following activities: 2016: Short-term capital loss of (20,000), a...

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Accounting

Adam is an individual taxpayer who has these followingactivities:

2016: Short-term capital loss of (20,000), a short-term capitalgain of 12,000, a Long-term capital loss of (15,000), and long-termgain of 10,000

2017: Short-term capital loss of (20,000), a short-term capitalgain of 12,000, a Long-term capital loss of (12,000), and long-termgain of 20,000

2018: Short-term capital loss of (6,000), a short-term capitalgain of 28,000, a Long-term capital loss of (11,000), and long-termgain of 30,000

Q1: What will be the carryover for Adam in 2019?

Q2: What capital loss or gain Adam will have for 2018?

Answer & Explanation Solved by verified expert
4.3 Ratings (732 Votes)

Year $ Caryy forward $
2016 Long-term Capital gain               10,000
Less: Set off of long-term losses              (15,000)                  (5,000)
Short-term capital gain               12,000
Less: Set off of short-term losses              (20,000)                  (8,000)
2017 Long-term Capital gain               20,000
Less: Set off of long-term losses              (12,000)
Long-term Capital gain after set off                  8,000
Add: Short-term capital gain               12,000
Less: Set off of Short-term losses              (20,000)
Net Capital gain or (loss)                        -                            -  
2018 Long-term Capital gain               30,000
Less: Set off of long-term losses              (11,000)
Long-term Capital gain after set off               19,000
Less: Set off of remaining long-term losses in the year 2016                (5,000)
Long-term Capital gain after set off               14,000
Add: Short-term capital gain               28,000
Less: Set off of Short-term losses for the current year                (6,000)
Less: Set off of remaining Short-term losses of the year 2016                (8,000)
Net Capital gain or (loss)               28,000                          -  
2019 Carryover capital losses for the year 2019 is zero.
All the carryover losses are set off in the year 2018.

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