- 6 - 1999 2000 2001 Net short-term capital gain or (loss)1 ($27,672) ($1,781,652) ($2,109,359) Net long-term capital gain or (loss)2 (9,825) (2,609) (107,733) Total net capital loss3 (37,497) (1,784,261) (2,217,092) 1 The net short-term capital loss for each taxable year included short-term carryover losses to 1999, 2000, and 2001 of $111,114, $27,672, and $1,781,652, respectively. 2 The net long-term capital loss for each taxable year included long-term carryover losses to 1999, 2000, and 2001 of $21,391, $9,825, and $2,609, respectively. 3 For each taxable year, petitioners deducted the maximum of $3,000 of their overall capital losses against ordinary income on their Form 1040, Line 13 (Capital gain or (loss)). See sec. 1211(b). In the notice of deficiency, respondent disallowed a portion of petitioners’ investment interest expense deductions for 1999, 2000, and 2001 in the amounts of $26,076, $38,784, and $49,483, respectively.3 Respondent contends that petitioners’ “gross income from property held for investment” for 1999, 2000, and 2001 was $5,139, $4,487, and $453, respectively.4 Respondent also argues that because petitioners had a total net capital loss in each of the taxable years at issue, petitioners had zero “net gain from the disposition of property held for investment” for purposes of determining their “net investment income” for each taxable year.5 3 Respondent concedes that the disallowed portion of investment interest expense deduction for 2001 erroneously includes otherwise deductible mortgage interest. 4 Petitioners concede these amounts of “gross income from property held for investment” for each taxable year at issue. 5 Respondent also concedes the amount of investment interest expenses claimed by petitioners for each taxable year at issue.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011