eBook Section 1231 Gains and Losses (L0.6) Fred's Foam Foundations (FFF) is a sole proprietorship that Fred started in 2015. Before the current year, FFF had not disposed of any property owned. During the current year, FFF has the following gains and losses: $3,200 Casualty loss on foam truck Section 1231 gains Section 1231 losses 9,400 3,000 a. What is the effect of these transactions on Fred's taxable income? If an amount is zero, enter "O". The Section 1231 netting results in an ordinary Fred has to recapture under the lookback rule. The of and a net capital is combined with Fred's other capital gains and losses b. In the following year, FFF has these gains and losses: $5,000 Casualty gain on building Section 1231 gains Section 1231 losses 3,000 17,000 What is the effect of these transactions on Fred's taxable income? The Section 1231 netting results in an deduction of Fred's taxable income by Previous Next Check My Work All work saved. Email Instructor Save and Exit Submit Assignment for Gr