Hope Corporation Was Liquidated Four Years Ago

question 78

Multiple Choice

Hope Corporation was liquidated four years ago. Teresa reported a $40,000 long-term capital gain due to the liquidation on her individual tax return. This year, Teresa pays $6,000 as part of the settlement of a lawsuit against Hope. Due to the $6,000 payment, Teresa recognizes a

• A)$6,000 long-term capital loss.
• B)$6,000 short-term capital loss.
• C)$6,000 ordinary loss.
• D)none of the above.

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