To determine whether a sale of a capital asset results in a short-term or long-term gain/loss, we need to consider the holding period of the asset.
- A short-term gain/loss occurs if the asset is held for one year (365 days) or less.
- A long-term gain/loss occurs if the asset is held for more than one year (more than 365 days).
Let's evaluate each option:
Option a:
- Bought on April 25, 2021
- Sold on August 19, 2022
The holding period here is from April 25, 2021, to August 19, 2022. This is more than one year (485 days), so it results in a long-term gain/loss.
Option b:
- Bought on May 30, 2021
- Sold on May 20, 2022
The holding period here is from May 30, 2021, to May 20, 2022. This is less than one year (356 days), so it results in a short-term gain/loss.
Option c:
- Bought on August 15, 2021
- Sold on August 16, 2022
The holding period here is from August 15, 2021, to August 16, 2022. This is exactly one year plus one day (366 days), so it results in a long-term gain/loss.
Option d:
- Bought on September 12, 2015
- Sold on August 19, 2022
The holding period here is from September 12, 2015, to August 19, 2022. This is more than one year (almost seven years), so it results in a long-term gain/loss.
Therefore, the correct answer which results in a short-term gain/loss is:
Option b: A capital asset bought on May 30, 2021, and sold on May 20, 2022
