1040 Preparation and Planning 5: Gross Income: Capital Gains and Losses (2024)

Author: Barbara Weltman, Sidney Kess, Greg White

Per the IRS Education Provider Standards this course must be COMPLETED by 12/31/2026 to receive credits

This five- hour CPE course, the fifth in the 1040 Preparation and Planning series, covers gains and losses, involuntary conversions, basis, capital and ordinary assets, and capital gains and losses. Tax developments reflected in this course, including changes made by the Consolidated Appropriations Act, 2023 (which includes SECURE Act 2.0), the Inflation Reduction Act of 2022, and other tax legislation, IRS pronouncements, and court decisions, are extensive. They impact 2023 tax year returns that will be filed during the 2024 filing season and refund opportunities for earlier years; as well as point the way to strategic planning in 2024 and beyond. This course brings the tax preparer "up-to-speed" in preparing 2023 tax returns for the 2024 filing season.

Publication Date: September 2023

Topics Covered

• Gain or Loss on the Sale or Exchange of Property
• Realized Gain or Loss
• Capital Gains Tax
• Capital Assets
• Exceptions for Capital Assets
• General Treatment of Capital Gains
• Exceptions for General Treatment of Capital Gains
• Determination of the Transaction's Tax Treatment
• Exchanges of Property
• General Treatment of Capital Losses
• Treatment of Capital Losses in Excess of Capital Gains
• Basis
• Purchase and Sale of a Going Business
• Loss on Property Acquired by Gift
• Adjustments for Gift Taxes Paid
• Securities Acquired at Different Prices
• Property Settlements
• Capital Gain Distributions
• Holding Period
• Section 1231 Gains and Losses
• Reporting Cryptocurrency Transactions
• Installment Method of Reporting Income
• Mark-to-Market Accounting for Traders in Securities
• Home Sale Exclusion
• Gain Allocated to the Period of Nonqualified Use
• Definition of a Principle Residence
• Special Marital Situations
• Unforeseen Circumstances
• Business Use of a Home
• Section 1244 Stock
• Nonbusiness Bad Debts
• Like-Kind Exchanges
• Exchange of Securities
• Involuntary Conversions

Learning Objectives

• Explain how taxable income affects the capital gains rate
• Describe what a capital asset is
• Explain tax basis and holding period
• Recognize how to figure gain or loss
• Recognize how to apply the capital loss limitation
• Explain the wash sale rule
• State the tax treatment of cryptocurrency
• Determine reporting under the installment sale rule
• Determine whether a transaction qualifies as a like-kind exchange
• Explain the rules for involuntary conversions
• State the tax benefits for Opportunity Zone investments
• Complete Form 8949 and Schedule D of Form 1040 or 1040-SR

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (5 hours)

Program Prerequisites
None

Advance Preparation
None