ASHIM CHISP Testking | CHISP Dumps Questions & CHISP Valid Exam Answers - Ijhssrnet

Full Exam Name: CHISP Test
Vendor Name: ASHIM Other Certifications
Exam Code: CHISP Exam


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NEW QUESTION: 1
Doris and Lydia are equal partners in the capital and profits of Agee & Nolan, but are otherwise unrelated.
The following information pertains to 300 shares of Mast Corp. stock sold by Lydia to Agee & Nolan:

The amount of long-term capital loss that Lydia realized in 1988 on the sale of this stock was:
A. $3,000
B. $2,500
C. $0
D. $5,000
Answer: D
Explanation:
Explanation
Choice "a" is correct. $5,000 long term capital loss "realized" in 1988 by Lydia. Be careful, and always
check the question being asked. In this case, the question is how much of a capital loss Lydia realized in
1 988.

Choice "b" is incorrect. $3,000 represents the portion of the $5,000 realized loss that would currently be
recognized unless there were additional capital transactions resulting in gains. Remember that the
deduction for capital losses for an individual is limited to $3,000 each year.
Choice "c" is incorrect. $2,500 represents the pre-1986 portion of the $5,000 realized loss that would have
given rise to a recognized loss. Pre-1986 law required $2 of net long term loss to give the benefit of $1 of
tax deduction. Current law gives a dollar-for-dollar deduction limited to $3,000 in any year.
Choice "d" is incorrect. $0 would have been the amount of loss recognized if Lydia owned more than a
5 0% interest in the partnership. Losses realized on transactions between a partnership and a partner
owning more than a 50% interest are not deductible as the parties would be considered related and any
realized loss would be disallowed.


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