Amount and Character of Loss Transactions . Five years ago,
Brian and his brother Boyd formed Stewart Corp., a golf apparel manufacturing
corporation. At that time, Brian con – tributed $300,000 to the corporation in
exchange for 50 % of its stock. During the current year, Brian needed some cash
to purchase a golf course so he sold a third of his interest in Stewart Corp.
for $85,000. He also sold stock in the following companies for the amounts
indicated:
During the year Brian hired a collection agency to collect a
$14,000 loan he made to an old friend, which was due in full on January 1 of
the current year. The agency found no trace of his friend. Also during the
year, BTR Corporation, in which he owns stock, went bankrupt. His investment
was worth $94,000 on January 1, he purchased it six years ago for $100,000, and
he expects to receive only $8,000 in redemption of his stock. Finally, Brian’s
salary for the year was $114,000 for his work as an associate
a.professor. a. What are the net gains and losses from the
above items and their character?
b. What is Brian’s AGI for the year assuming he has no other
items of income or deduction?
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