Spencer Has an Investment in Two Parcels of Vacant Land

Multiple Choice

Spencer has an investment in two parcels of vacant land.Parcel 1 is a capital asset and parcel 2 is a § 1231 asset. Spencer already has a short-term capital loss for the year that he would like to offset with capital gain.He has a §
1231 lookback loss that exceeds the gain from the disposition of either land parcel.Spencer wants to sell only one land parcel: each of them would yield the same amount of gain.The gain that would be recognized exceeds the short-term capital loss Spencer already has.Which of the following statements is correct?

A) Spencer will have a net capital loss no matter which land parcel he sells.
B) Spencer will have a net capital loss if he sells parcel 2.
C) Spencer will have a net capital loss if he sells parcel 1.
D) Spencer will have a net capital gain if he sells either parcel 1 or parcel 2.
E) None of these.