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Business, 05.05.2020 16:46 christian5668

Linda purchased a home in Connecticut three years ago for $300,000. She had been working in Connecticut for the past 10 years. Yesterday, her employer decided to transfer her to the Billings, Montana branch, effective next month. Unfortunately, the real estate market has weakened over the past few years, and Linda is only able to sell her home for $270,000. Which of the following statements correctly identifies the tax consequences of the sale:
a. Linda is not permitted to deduct the loss on her income tax return.
b. Linda’s loss will be reflected as a long-term capital loss on her tax return.
c. Linda’s loss will be reflected as a short-term capital loss on her tax return.
d. Linda will recognize an ordinary loss of $30,000.

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