Calculate her net income for tax purposes

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Question - Maria Shank operates an unincorporated business which, during the taxation year ending December 31, 2019 has net business income of $28,000 and a taxable capital gain of $6,500 [(1/2)($13,000)].

In 2020, her business has a net loss of $85,000. In addition to this loss, a capital asset disposition results in an allowable capital loss of $10,800.

Maria has no other sources of income or deductions in either year. Assume that she wishes to minimize her net capital and non-capital loss carry overs at the end of 2020, without regard to her ability to claim her tax credits for the preceding year (2019). Calculate her Net Income For Tax Purposes and Taxable Income for 2019 and 2020 and any amended amounts for 2019. 

Indicate the amount and type of any losses available for carry forward at the end of 2020.

Reference no: EM132919995

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