Gilliam, a single taxpayer, acquired stock in a corporation that qualified as a small business corporation under 1244, at a cost of $138,000, four years ago. He sells the stock for $75,000 in the current tax year. If an amount is zero, enter "0". a. Gilliam would have a capital loss of $______ and an ordinary of loss of $_____ for tax purposes.

b. Assume instead that Gilliam sold the stock to his cousin Mackenzie Jones, a six months after it was acquired for $138,000 (its fair market value). If Mackenzie sells the stock for $100,000 in the current year, she would have a capital loss of $ _____and an ordinary of loss of $______ for tax purposes.

c. Enter the results of this transaction to Mackenzie on Form 1040, Schedule D (p. 1). Assume that relevant facts from the transaction initially had been shown on Form 8949 with Box F checked. If required, use the minus to indicate a loss. If an amount is zero, enter "0". SCHEDULE D (Form 1040) Department of the Treasury Internal Revenue Service (99) Capital Gains and Losses Attach to Form 1040 or Form 1040NR. Information about Schedule D and its separate instructions is at www.irs.gov/scheduled.

Use Form 8949 to list your transactions for lines 1b, 2, 3, 8b, 9, and 10. OMB No. 1545-0074 2017 Attachment Sequence No. 12 Name(s) shown on return Mackenzie Jones Your social security number 123-45-6789 Part I Short-Term Capital Gains and LossesAssets Held One Year or Less See instructions for how to figure the amounts to enter on the lines below. (d) Proceeds (sales price) (e) Cost (or other basis) (g) Adjustments to gain or loss from Form(s) 8949, Part I, line 2, column (g) (h) Gain or (loss) Subtract column (e) from column (d) and combine the result with column (g) This form may be easier to complete if you round off cents to whole dollars.

1a Totals for all short-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line

1b 1b Totals for all transactions reported on Form(s) 8949 with Box A checked . . . . . . . . . . . . . . . . . . . . . . .

2 Totals for all transactions reported on Form(s) 8949 with Box B checked . . . . . . . . . . . . . . . . . . . . . . .

3 Totals for all transactions reported on Form(s) 8949 with Box C checked . . . . . . . . . . . . . . . . . . . . . . .

4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824 . . . . . . . . . 4

5 Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 . . . . 5

6 Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss Carryover Worksheet in the instructions . . . . . .6 ()

7 Net short-term capital gain or (loss). Combine lines 1a through 6 in column (h). If you have any long-term capital gains or losses, go to Part II below. Otherwise, go to Part III on the back . . . . . . . . . . . . . . . . . . . . 7

Part II Long-Term Capital Gains and LossesAssets Held More Than One Year See instructions for how to figure the amounts to enter on the lines below. (d) Proceeds (sales price) (e) Cost (or other basis) (g) Adjustments to gain or loss from Form(s) 8949, Part II, line 2, column (g) (h) Gain or (loss) Subtract column (e) from column (d) and combine the result with column (g) This form may be easier to complete if you round off cents to whole dollars.

8a Totals for all long-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 8b 8b Totals for all transactions reported on Form(s) 8949 with Box D checked . . . . . . . . . . . . . . . . . . . . . . .

9 Totals for all transactions reported on Form(s) 8949 with Box E checked . . . . . . . . . . . . . . . . . . . . . . .

Proceed Cost Gain

10 Totals for all transactions reported on Form(s) 8949 with Box F checked . . . . . . . . . . . . . . . . . . . . . . . $____ $____ $_____

11 Gain from Form 4797, Part I; long-term gain from Forms 2439 and 6252; and long-term gain or (loss) from Forms 4684, 6781, and 8824 . . . . . . . . . . . . . . . . . . . . . . . . . . 11

12 Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 . . . . 12

13 Capital gain distributions. See the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

14 Long-term capital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss Carryover Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 () 15 Net long-term capital gain or (loss). Combine lines 8a through 14 in column (h). Then go to Part III on the back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 $____ KAI For Paperwork Reduction Act Notice, see your tax return instructions. Schedule D (Form 1040) 2017