[MaLoTu]

What is the significance of a Corporate Capital loss carryforward/Back being Short-term? I know that is the rule, but why is the distinction important?

When you are determining gross income, and you have ST capital gains and losses and LT capital gains and losses, they net … so I don’t get it.

Almost always from my phone... please excuse my typos!

All 4 passed - 2016

CA CPA

[23K]

I had the same question on my mind.

From what I know for C-Corp all short term & long term capital gains & losses are taxed at the same rate.

So I don't understand why it matters, at the end of the day if you net them all.

Unlike Individual there are tax preferences so it does matter if it is short term or long term.

Can anyone help with the question or logical ?

AUD--52,68,83, expired. Retake = 74 RETAKE - 7.24.26
FAR--73,70,68,75
BEC-- 79
REG-- 68,62,75

[CPAfit]

If I'm not mistaken, I remember from the ninja REG audio that ST capital loss is taxed at the ordinary income tax rate which is higher than the capital gains rate. Hope this helps.

AUD - 82
BEC - 78
FAR - 78
REG - 83

HIYA!

NH Licensed CPA - Jun 2018

[Pain In The Assets]

actually, corporate capital losses are deductible only to the extent of capital gains and net short term capital gains are taxed at ordinary rates

[MaLoTu]

Thanks, Zubairs – I think I vaguely remember that being mentioned in an audit lecture, as well.

Almost always from my phone... please excuse my typos!

All 4 passed - 2016

CA CPA

[23K]

@ zubairs

Net capital gains of a corporation, either short-term or long-term, do not qualify for any special lower tax rates; such gains are simply taxed as ordinary income.

In other words, unlike regular corporate expenses, which are deducted from corporate ordinary income, a C corporation's capital loss may not be deducted from a C corporation's ordinary income; it may only be deducted from capital gains.

AUD--52,68,83, expired. Retake = 74 RETAKE - 7.24.26
FAR--73,70,68,75
BEC-- 79
REG-- 68,62,75

[Author]

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