Carlie who is single has a Sec. 1231 gain of $10,000 and no Sec. 1231 losses during the current year. Explain why the gain might be taxed at (a) 15%, (b) 37%, (c) 25%, (d) 20%, or (e) zero.

Review the explanations provided carefully and select the explanations that would be taxed at the following rates:

1.	Her regular tax rate is 37% and she has at least $10,000 of unrecaptured Sec. 1231 losses, which means that the gain is taxed as ordinary income.
2.	Because the Sec. 1231 gains exceed the Sec. 1231 losses, the $10,000 is characterized as adjusted net capital gain (ANCG). Her taxable income is more than $441,450.
3.	Her regular tax rate is 20% and she has at least $5,000 of unrecaptured Sec. 1231 losses, which means that the gain is taxed as ordinary income.
4.	Because the Sec. 1231 gains exceed the Sec. 1231 losses, the $10,000 is characterized as ANCG. If her taxable income is more than $40,000 and less than or equal to $441,450, the gain will be taxed at 15%.
5.	The gain is from the sale of a building and she has $10,000 Sec. 1231 gain and all of the gain is unrecaptured Sec. 1245 gain. Depreciation deducted was at least $10,000.
6.	Because the Sec. 1231 gains exceed the Sec. 1231 losses, the $10,000 is characterized as ANCG. Her taxable income is $40,000 or less.
7.	Because the Sec. 1231 gains exceed the Sec. 1231 losses, and all of the $10,000 gain is unrecaptured Sec. 1250 gain. Her taxable income is $40,000 or less.
8.	The gain is from the sale of a building and she has $10,000 Sec. 1231 gain and all of the gain is unrecaptured Sec. 1250 gain. Depreciation deducted was at least $10,000.

(a) 15%

(b) 37%

(c) 25%

(d) 20%

(e) zero