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The Richmonds have two questions they would like you to address. Note: you can assume you are writing this email in February 2023. 1. Next
The Richmonds have two questions they would like you to address. Note: you can assume you are writing this email in February 2023. 1. Next year (2023), Nelson is considering selling some shares of stock in his employer, which will generate substantial long-term capital gains (he estimates he will have a LTCG of approximately \$25,000). The Richmonds also anticipate selling 3,500 more shares of Lynn Inc. stock. Remember that Lynn Inc. is NOT related to Nelson's job. - Under the general rule, which shares of Lynn Inc. are the Richmonds deemed to sell if they do not use specific identification? Assuming the share price is $9 at the date of sale, what would their gain or loss be under the general rule if Nelson decides to sell the stock? - Assuming Nelson plans to sell employer stock and the full 3,500 shares of Lynn Inc. stock. How could the Richmonds minimize their tax liability with LTCG / L associated with this stock sale? Be sure to take their whole tax situation into account (i.e., Nelson's anticipated employer stock sale in 2023, from Part 1), and mention loss carryforwards if any. - What do you recommend the Richmonds do to minimize their tax liability (or maximize their tax position) in 2023? Should Nelson hold off on selling some shares of his employer stock? Expedite it? What should he do with the Lynn Inc. stock? Lynn Inc. Stock Purchase Records
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