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6. Brandon, an individual, began business four years ago and has sold 1231 assets with $5,650 of losses within the last 5 years. Brandon owned

6. Brandon, an individual, began business four years ago and has sold 1231 assets with $5,650 of losses within the last 5 years. Brandon owned each of the assets for several years. In the current year, Brandon sold the following business assets:

Asset Original Cost Accumulated Depreciation Gain/Loss
Machinery $31,300 $8,300 $10,650
Land $53,000 $0 $26,500
Building $116,00 $33,000 ($18,000)

Assuming Brandon's marginal ordinary income tax rate is 32 percent, what effect do the gains and losses have on Brandon's tax liability?

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