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Five years ago, Brian and his brother Boyd $300,000 to the corporation in exchange for 50% of its stock. During the current year, Brian needed some cash to purchase a golf course so he sold a third of his interest in Stewart Corp. for $85,000. He also sold stock in the following companies for the amounts indicated:

Corporation            Sales Proceeds           Adjusted Basis        When Acquired

IBM          $15,000              $10,000         52 months ago

Microsoft  25,000   45,000  18 months ago

Tidal Radio             32,000  12,000           7 months ago

Wavetable               20,000  26,000           4 months ago

During the year Brian hired a collection agency to collect a $14,000 loan he made to an old friend, which was due in full on January 1 of the current year. The agency found no trace of his friend. Also during the year, BTR Corporation, in which he owns stock, went bankrupt. His investment was worth $94,000 on January 1, he purchased it six years ago for $100,000, and he expects to receive only $8,000 in redemption of his stock. Finally, Brian’s salary for the year was $114,000 for his work as an associate professor.

  1. What are the net gains and losses from the above items and their character?
  2. What is Brian’s AGI for the year assuming he has no other items of income or deduction?