Chapter 18: Character of Gains & Losses

In this section

• §1231, Capital vs. Ordinary & Netting High-Level Overview
  Learn how Section 1231 gains and losses are characterized, the netting process, and how prior net 1231 losses can reclassify gains as ordinary. Understand capital versus ordinary treatment, the five-year lookback rule, and practical strategies for CPA exam success.
• Depreciation Recapture under §1245 & §1250
  Comprehensive exploration of depreciation recapture rules under Sections 1245 and 1250, including practical scenarios for equipment (personal property), real estate (real property), partial dispositions, and multiple depreciation methods.
• Installment Sales: Imputed Interest, Dealer Dispositions & Exceptions
  Comprehensive guide to installment sales, covering the gross profit ratio formula, imputed interest rules, dealer disposition exclusions, and significant exceptions, with practical examples and best practices for CPA exam success.
• Section 1202 (QSBS) Exclusions & Holding Period Requirements
  Explore how to achieve the 100% QSBS Exclusion under IRC Section 1202, including holding period requirements, eligibility thresholds, and state-level nuances.