Tax savings from special tax treatment

Reference no: EM1310928

Daniel is considering selling two stocks that have not fared well over recent years. A friend recently informed Daniel that one of his stocks has a special designation, which allows him to treat a loss up to $50,000 on this stock as an ordinary loss rather than the typical capital loss. Daniel figures that he has a loss of $60,000 on each stock. If Daniel's marginal tax rate is 35 percent and he has $120,000 of other capital gains (taxed at 15 percent), what is the tax savings from the special tax treatment?

Reference no: EM1310928

Questions Cloud

Evaluate the internal rate of return : Evaluate the net present value at a 14% required rate of return and evaluate the internal rate of return and the payback period of the investment.

What is the over or under absorbed overhead : How much overhead is allocated? What is the over/under absorbed overhead?

Rough-and-tumble activities : Their neighbors Doug and Diane have a daughter who they consider to be a tomboy because she likes to play ball and rough-and-tumble activities in the yard.

Journal entries for warranty repairs : Journal entries for warranty repairs. - 1. Paid $12,350 for warranty repairs originally accrued in 2008.

Tax savings from special tax treatment : Daniel figures that he has loss of $60,000 on each stock. If Daniel's marginal tax rate is 35 percent and he has $120,000 of other capital gains (taxed at 15 percent), what is tax savings from the special tax treatment?

Animal studies concepts : Animal studies have shown which of the following to be true?

Journal entries for sold merchandise inventory : Merchandise Inventory on account. All sales are recorded net of the 2% discount offered by the company. (Any discounts not eventually taken by the purchaser are recognized as interest income.) Shipping charges of $450 were paid by the purchaser..

Traits of good leadership and personal accountability : Demonstrate the traits of good leadership, personal accountability and responsibility be someone you admire and would like to have as a mentor or role model.

Nonfinancial information which used to evaluate performance : Discuss the nonfinancial information that may be used to evaluate the performance of a college or university and suggest what information provides the most insight to financial performance.

User Account

All Pages