Can capital gain be offset by a loss other than a capital gains loss?

Question

If one's has a capital gain which results in a $5000 is tax liability, can that this be offset by losses from something other than a capital gain loss (ex. a business loss of $5000 offsets a capital gain of $5000)?

Wayne Z · Accepted Answer

Not directly.

However, a $5000 capital gain and a $5000 business loss during the same year would net to $0.

For example, an individual with a $5000 capital gain and a $5000 business loss and no other income would have an adjusted gross income of $0 and would have to pay $0 taxes.

Anonym · Answer

The only reason capital gains and losses and business gains and losses are classified differently is due to them being taxed at different rates.

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tro · Answer

not directly, no
when you enter your items on the 1040, if you have a loss in your business and you also have a cap gain loss, it only reduces your gross income, they don't offset each other
each loss is still attributable to the type of income it was, i.e. business, cap gains etc

Can capital gain be offset by a loss other than a capital gains loss?

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