Question

During 2018, Dana had the following gains and losses. Calculate her 2018 total tax liability for these items if her marginal tax bracket is 24%

-LT gain from sale of personal boat $5000

-LT gain from sale of dimand ring $300

-LT loss from sale of ICM corp. stock $1,000

-ST loss from sale of Swan Co. stock $500

-ST gain from sale of green co. stock $3000

Answer 1

LT gain from sale of personal boat				$5,000
LT gain from sale of dimand ring				$300
LT loss from sale of ICM corp stock				($1,000)
Net LT gain				$4,300
Since Dana's marginal tax bracket is 24% she follows under income of $82500-$157500, based on this income the long term tax rate is 15%
Long term gain tax $4300*15%				645
ST gain from sale of green co				$3,000
ST loss from sale of Swan co				$500
Net ST gain				$2,500
While long term gain are taxed based on the income of the tax payer, short term capital gain are taxed based on the ordinary income and marginal tax rate is applicable
Short Term gain tax $2500*24				600
Total Tax liability		645+600		1245