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Determine the taxable amounts and tax implications

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Reference no: EM132949677

Reggie has just met with Sameer, CPA, to discuss his tax situation for the 2020 year. Reggie has been a long-time investor in Tech Giant Inc. (TGI), a public company. In 2020, he sold all his shares due to a downturn in the economy.

The following transactions have occurred over the time that Reggie has owned shares in TGI:

  • March 31, 2015: Purchased 1,500 shares at $175 per share.
  • December 27, 2015: Purchased 2,000 shares at $169 per share.
  • January 15, 2016: Sold 1,000 shares at $150 per share.
  • October 30, 2020: Received an eligible stock dividend of 5% that resulted in an increase in the paid-up capital of TGI of $210 per share.
  • December 15, 2020: Sold all of his shares at $230 per share.

Reggie advised Sameer that he has filed an election to treat the disposition of Canadian securities as a capital transaction.

Required:

Problem 1: Determine the taxable amounts and tax implications of the sale of TGI shares in 2020. Show all your calculations.

Reference no: EM132949677

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