Question

Three years ago, Adrian purchased 170 shares of stock in X Corp. for $30,090. On December 30 of year 4, Adrian sells the 170 shares for $26,690. (Leave no answers blank. Enter zero if applicable.)

a. Assuming Adrian has no other capital gains or losses, how much of the loss is Adrian able to deduct on her year 4 tax return?

b. Assume the same facts as in part (a), except that on January 20 of year 5, Adrian purchases 170 shares of X Corp. stock for $26,690. How much loss from the sale on December 30 of year 4 is deductible on Adrian’s year 4 tax return? What basis does Adrian take in the stock purchased on January 20 of year 5?

Answer 1

(a) Three years ago, Adrian purchased shares

Sale of 170 shares on ,december 30     = $26,690

less: Cost of Purchase of 170 shares   = $30,090

Loss on sale of shares                        = $3,400

(b) Loss will be the same as pervious year, on january 20 of year 5, stock will be of 170 shares for $ 26,690 (purchased from x Corp. on january 20)