The Smiths sold the following assets/investments during this year:

A) 2/8/2021 sold for $10,400 common stock in Intense, Co. that was purchased for $5,000, on 4/23/2015, The shares of Intense Co are qualified small business stock under §1202.

B) 5/13/2021 sold 300 shares of common stock in Franklin Co. for $11,000. They had purchased 200 shares on 8/7/2018 for $7,500 and 100 shares on 8/7/2019 for $ 8,250.

C) 8/5/2021 sold 100 shares of common stock of Hampton Co for $13,000 total that were purchased for $11,550 on 2/9/2021.

D) 6/15/2021 sold for $18,000 gold coins that Anna inherited from her grandmother on March 17, 2021, when its FMV was $15,500. Her grandmother had a basis in the gold coins of $3,500.

E) 9/15/2021, they sold a portion of a parcel of land with a barn for $75,000 that had a basis of $18,000 and was purchased in 2004. $25,000 of the gain is un-recaptured §1250 property.

F) John bought 400 shares of Apple stock on January 1, 2015 for $200 per share with a brokerage fee of $1,000. He sold 200 shares for $140 per share on November 22, 2021. John then purchased 100 shares of the same type of Apple stock on December 28, 2021 for $132 per share.

G) The Smiths have a Long-term loss carryover of $7,000 from 2020.

 

Transcribed Image Text:

15 Step 3(a) 16 step 3(b) 17 step 3(c) 18 step 4 19 step 5(a) 20 step 5(b) A 21 step 6(a) 22 step 6(b) 1 2 3 4 5 6 A 7 B 8 C 9 D 10 E 11 F 12 G Carryover 13 Total Gain/ (Losses) Steps 1 & 2 14 Netting Steps: B 23 step 7 24 NET GAIN (LOSSES) C John and Anna Smith Sale of Assets 2021 Items Proceeds D Cost E Net Gain (Loss) Short Term Capital Gain/(Loss) 0 0 0 0 0 0 0 F 0 0 0 G 0 H Long Term Capital Gain/(Loss) 28% 25% 0/15/20 0 0 1 0 0 0 15 Step 3(a) 16 step 3(b) 17 step 3(c) 18 step 4 19 step 5(a) 20 step 5(b) A 21 step 6(a) 22 step 6(b) 1 2 3 4 5 6 A 7 B 8 C 9 D 10 E 11 F 12 G Carryover 13 Total Gain/ (Losses) Steps 1 & 2 14 Netting Steps: B 23 step 7 24 NET GAIN (LOSSES) C John and Anna Smith Sale of Assets 2021 Items Proceeds D Cost E Net Gain (Loss) Short Term Capital Gain/(Loss) 0 0 0 0 0 0 0 F 0 0 0 G 0 H Long Term Capital Gain/(Loss) 28% 25% 0/15/20 0 0 1 0 0 0

Answer rating: 100% (QA)

To calculate the capital gains tax for the Smiths we need to first determine their net capital gain This is done by netting their shortterm and longte... View the full answer