Loss Limitations (8)

Question 1

transactions would qualify for tax-deferred exchanges?

Answer 1

Transfer of property to a controlled corporation

Question 2

considered a tax-deferred transaction?

Answer 2

A statutory merger or consolidation (Type A)

Question 3

A Type A statutory merger is usually completed as a

Answer 3

stock-for-stock swap without a payment of cash, qualifying as a like-kind exchange.

Question 4

Capital assets include:

Answer 4

a manufacturing company’s investment in U.S. Treasury bonds.

Question 5

Sales of capital assets held over a year result in

Answer 5

long-term capital gain.

Question 6

the tax treatment of net losses in excess of the at-risk amount for an activity?

Answer 6

Any losses in excess of the at-risk amount are suspended and carried forward without expiration and are deductible against income in future years from that activity.