Question

Capital Loss Carryback/Carryover

Skagway Co., Inc. recognizes the following capital gains and losses during 20X4:

Short-term capital gain – $10,000
Short-term capital loss – (33,000)
Long-term capital gain – 15,000
Long-term capital loss – (44,000)

On its 20X1 tax return, Skagway's netting of its capital gains and losses produced a net capital gain of $7,000.

Short-Term
$13,000
(18,000)
———-
($5,000)

Long-Term
$18,000
(6,000)
———–
$12,000
(5,000)
———–
$7,000

Compute Skagway's capital loss carryback to 20X1 and determine its capital loss carryover to 20X2.

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