SHORT ANSWER Johnny sells an asset that he owned for less than one year and realizes a $5,000 gain. Why would it be better if he held the asset more than a year before he sold it? A. It is used to report income and calculate how much federal tax is owed. B. When total tax withholdings exceed the tax due. C. Taxpayers can claim certain amounts of deductions, exemptions, or other items that are subtracted from gross income to derive taxable income. D. The gain would be long-term and taxed at a lower rate. E. No. Many estates never pay a tax because a certain amount can pass to heirs without tax. (Money left to surviving spouses is also not taxed.) Choose A B C D E