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Author: ukyo Two stars, 250 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121095  
Subject: Q: Effects of carryover from stock losses Date: 12/27/2002 2:19 PM
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Hi,

If I am sitting on $10,000 of losses carried over from the previous year, and this year I sell stock at a gain of $5000, which of the following scenarios applies?:

1. The $5000 gain is offset by the $10,000 that I am already sitting on, so I will still be able to offset my income by $3000, but my carryover for next year will be $2000 ($10,000 - $5000 gain - $3000 that I can charge against my income this year)

2. The $5000 gain is offset by only $3000 for this year, and I will be taxed for the other $2000. My carryover for next year will be $7000.

3. Something else?

Thanks.
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