Brandon, an individual, began business four years ago and has sold $1231 assets with $5,750 of losses within the last five years. Brandon owned each of the assets for several years. In the current year, Brandon sold the following business assets: Asset Machinery Land Building Original Cost Accumulated Depreciation $31,500 55,000 120,000 $8,500 Gain/Loss $ 10,750 35,000 27,500 (20,000) Assuming Brandon's marginal ordinary income tax rate is 32 percent, what effect do the gains and losses have on Brandon's tax liability? Use dividends and capital gains tax rates for reference.