Which of the Following Statements About the Individual Capital Gains

question 78

Multiple Choice

Which of the following statements about the individual capital gains and losses is false?

• A) Gain on sale of Section 1231 depreciable real property is taxed at a 25% maximum rate.
• B) Short-term capital gains are taxed as ordinary income.
• C) Capital losses are deductible only against capital gains.
• D) Nondeductible capital losses are carried forward for deduction against future capital gains.

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Definitions:

Direct Physical Loss

Damage or loss of property directly resulting from an identifiable event or cause, without intervening factors.

Property Damage

Physical damage to, or destruction of, tangible property, often resulting in financial loss.

Antilapse Clause

In an insurance policy, a clause which states that the insured has a grace period in which to make an overdue payment.

Appraisal

An expert estimation of the value of property, typically real estate, art, or jewelry, often for the purpose of taxation, sale, or insurance.