How to Calculate Capital Gains: Definition, Formula & Example


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The ABC corporation sells a vacant lot it has owned for a few years. There is no physical property to depreciate and no improvements have been made to the property. The property sold for $130,000 and it was originally purchased for $90,000. What is the amount of capital gains tax due from the sale if the company is in the 39% tax bracket?

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1. Which of the following is TRUE of capital gains taxes for C Corporations?

2. An asset's _____ is subtracted from the sale price to determine the capital gain or loss.

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About This Quiz & Worksheet

Success on the questions on this quiz and worksheet require knowledge of how capital gains are calculated. You must also know about corporate taxes.

Quiz & Worksheet Goals

Questions assess the following:

  • Taxes on a corporation's capital gains
  • The calculation of capital gain or loss
  • Capital gains taxes for C Corporations

Skills Practiced

  • Knowledge application - use your knowledge to identify the amount of capital gains tax due on a given sale in a specific tax bracket
  • Reading comprehension - ensure that you draw the most important information from the lesson on capital gains calculations
  • Information recall - access the knowledge you've gained regarding why corporations have a special tax treatment for capital gains

Additional Learning

Learn more about corporate finance by completing the lesson titled How to Calculate Capital Gains: Definition, Formula & Example. Information discussed includes:

  • Capital assets
  • The basis of a corporation
  • Adjusted basis