Josh, a calendar year taxpayer sold 2 Section 1231 assets during the year.He had $5,000 of non-recaptured net Section 1231 losses from 3 years ago.What is the amount and character of the gain?

Asset

Purchase Date

Cost

Accumulated Depreciation

Sales Price

Sales Date

Equipment

11/12/2016

$105,000

$46,000

$125,000

8/19/19

Computer

4/12/2017

$20,000

$13,500

$3,750

8/19/19

A.$5,000 as ordinary income, gain of $59,500 subject to 1245 recapture and a L/T capital loss of $1,250.

B.$5,000 as ordinary income, gain of $46,000 subject to 1245 recapture and a L/T capital gain of $12,250.

C.$5,000 as ordinary loss, gain of $46,000 subject to 1250 recapture and a L/T capital gain of $17,250

D.$49,750 of gain subject to 1245 recapture and a L/T capital gain of $13,500.

E. $5,000 as ordinary income, gain of $61,000 subject to 1245 recapture and a L/T capital loss of $2,750