Key Tax Concepts and Calculations Explained
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- What does boot mean?
- How to determine the basis of taxable and non-taxable stock dividends?
- How to determine if a gain is long-term or short-term?
- How does capital gain/loss netting work?
- What is the tax rate of regular long-term capital gain? [0%, 15%, 20%]
- Individual taxpayers can deduct net capital loss (short-term or long-term) up to $3,000 per year.
- The maximum tax rate for collectibles is 28%; the maximum tax rate for unrecaptured Section 1250 gain is 25%.
- How to determine amount realized? How to determine amount realized when there is debt assumption?
- What is unrecaptured Section 1250 gain? How to calculate it?
- What is the basis of gifts? How to determine the holding period of a gift?
- How to determine the adjusted basis?
- How to determine realized gain or loss? Realized gain/loss = amount realized minus adjusted basis.
- Does inventory qualify for non-recognition in a like-kind exchange? No.
- How to determine the basis and holding period of an inherited property?
- How to determine the basis of a property that is converted from personal to business use?
- How to determine the amount of American Opportunity Tax Credit?
- How to determine the basis of taxable and non-taxable stock dividends?
- How to determine whether a taxpayer pays AMT or regular tax?
- How to determine if there is net boot received or net boot given?
- What are like-kind properties?
- In a like-kind exchange, when does the taxpayer recognize gain or loss?
- How to determine the gain/loss recognized in a like-kind exchange? How to determine the basis of the new asset received in a like-kind exchange?
- What is a Section 1231 asset?
- Section 1231 gains are taxed as long-term capital gains (after the five-year loss look-back). Section 1231 losses are taxed as ordinary losses.
- Losses from related-party sales are not deductible by the seller.
- What is a Section 1245 property?
- What is recaptured Section 1245 gain? How is it taxed? [Section 1245 gains are taxed as ordinary income.]
- Loss from involuntary conversion is deductible; gains from involuntary conversion may be deferred.