On September 3, 2017, Able, a Single Individual, Purchased §

question 72

Multiple Choice

On September 3, 2017, Able, a single individual, purchased § 1244 stock in Red Corporation from his friend Al for $60,000. On December 31, 2017, the stock was worth $85,000. On August 15, 2018, Able was notified that the stock was worthless. How should Able report this item on his 2018 tax return?

• A) $85,000 capital loss.
• B) $85,000 ordinary loss.
• C) $50,000 ordinary loss and $35,000 capital loss.
• D) $60,000 ordinary loss.
• E) None of the above.

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Definitions:

Physical Markers

Observable or measurable physical traits that can be used to identify particular characteristics or conditions in individuals.

Social Construct

A concept or perception of something based on the collective views developed and maintained within a society or social group, rather than existing inherently.

Profound Effects

Significant or deep impacts that can bring about substantial changes or consequences in a system, individual, or society.