Vertigo, Inc, has a 2017 net § 1231 loss of $64,000 and had a $32,000 net § 1231 gain in 2016 . For 2017, Vertigo's net § 1231 loss is treated as:
a. Ordinary loss.
b. Ordinary gain.
c. Capital loss.
d. Capital gain.
e. None of the above.
a
RATIONALE: Since there is a 2017 net § 1231 loss, the loss is treated as an ordinary loss. Section 1231 lookback applies only if there is a current year § 1231 gain.
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