On June 1, 2014, Brady Purchased an Option to Buy

question 36

Multiple Choice

On June 1, 2014, Brady purchased an option to buy 1,000 shares of General, Inc. at $40 per share. He purchased the option for $3,000. It was to remain in effect for five months. The market experienced a decline during the latter part of the year, so Brady decided to let the option lapse as of December 1, 2014. On his 2014 tax return, what should Brady report?

• A) A $3,000 long-term capital loss.
• B) A $3,000 short-term capital loss.
• C) A $3,000 § 1231 loss.
• D) A $3,000 ordinary loss.
• E) None of the above.

---

Definitions:

Online News Feeds

Digital streams of news content provided on the internet by various media outlets, allowing users to access real-time news updates and information from multiple sources.

Drug Bust

A law enforcement action aimed at stopping the illegal drug trade, typically involving the seizure of drugs and arrest of individuals involved.

Marcus Garvey

A prominent Black nationalist leader who advocated for the Pan-Africanism movement and the return of the African diaspora to their ancestral lands.

Malcolm X

An African American Muslim minister and human rights activist in the 1950s and 60s, known for his advocacy for the rights of blacks and his criticism of the civil rights movement for its emphasis on nonviolence.