To better understand the rules for offsetting capital losses and how to treat capital losses carried

To better understand the rules for offsetting capital losses and how to treat capital losses carried forward, analyze the following data for an unmarried individual for the period 2007 through 2010. No capital loss carry forwards are included in the figures.For each year, determine AGI and the capital losses to be carried forward to later tax year.Please use the attached Excel spreadsheet

Required:

For each year, determine AGI ad the capital losses to be carried
forward to later tax year.

Solution

2010

2011

2012

2013

AGI
(excluding property transactions)
$ 40,000

$ 50,000

$ 60,000

$ 70,000

Short-term
capital gains (STCG)
4,000

5,000

7,000

10,000

Short-term
capital losses (STCL)
9,000

3,000

5,000

12,000

Long-term
capital gains (LTCG)

6,000

10,000

2,200

6,000

Long-term
capital losses (LTCL)
5,000

21,000

1,000

9,500

AGI
(included in property transactions)

STCL
to be carried forward

–

–

–

LTCL
to be carried forward

–

Reconciliation:

NSTCG (NSTCL)

Carryforward
from prior year

Adjusted
carryforward amount

NLTCG (NLTCL)

Carryforward
from prior year

Adjusted
carryforward amount

Capital
loss recorded on tax return