Question
16. Abby, a single taxpayer, purchased 10,000 shares of 1244 stock several years ago at a cost of $20 per share. In November of the
16. Abby, a single taxpayer, purchased 10,000 shares of 1244 stock several years ago at a cost of $20 per share. In November of the current year, Abby receives an offer to sell the stock for $12 per share. She has the option of either selling all of the stock now or selling half of the stock now and half of the stock in January of next year. Abbys salary is $80,000 for the current year, and it will be $90,000 next year. Abby has long-term capital gains of $8,000 for the current year and will have $10,000 next year. If Abbys goal is to minimize her AGI for the two years, determine whether she should sell all of her stock this year or half of her stock this year and half next year.
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