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Once § 1231 gains are netted against § 1231 losses, if the gains exceed the losses, the net gain is offset by the “lookback” nonrecaptured § 1231 losses.TrueFalse

Question

Once § 1231 gains are netted against § 1231 losses, if the gains exceed the losses, the net gain is offset by the “lookback” nonrecaptured § 1231 losses.

  1. True
  2. False
check_circleAnswer
Step 1

Internal Revenue Code (IRC):

 

Internal Revenue Code is generally referred to as “The CODE” outlines all the federal tax laws.

 

 

Nonrecaptured § 1231 losses:

 

Nonrecaptured § 1231 losses refer to the losses over the past 5 years that are unapplied. The main objective of § 1231 is to avoid any manipulation of the gains and losses.

Step 2

The given statement Once § 1231 gains are netted against § 1231 losses, if the gains exceed the losses, the net gain is offset by the “lookback” nonrecaptured § 1231 losses is True.

 

The § 1231, requires the losses under § 1231  to be applied or to be matched with a gain from § 1231,...

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