This year, Jack O. Lantern incurred a $60,000 loss on the worthlessness of his stock in the Creepy Corporation (CC). The stock, which Jack purchased in 2005, met all of the 1244 stock requirements at the time of issue. In December of this year, Jacks wife, Jill, also incurred a $75,000 loss on the sale of Eerie Corporation (EC) stock that she purchased in July 2005 and that also satisfied all of the 1244 stock requirements at the time of issue. Both corporations are operating companies. Assume that they file a joint return.

c. What would be the tax treatment for the losses if Jack and Jill reported only $60,000 of taxable income this year, excluding the securities transactions?

Total loss deductible	$0
Ordinary loss carryover	$40,000
Capital loss carryover	$35,000

What is the answer to Total loss deductible??