A net short-term capital gain is considered as profits that occur from the sale or exchange of a capital asset like bonds, stock, or real estate that was held by the foundation for a period of less one year.
Any profits that occur from the sale or exchange of depreciable property, land used in a trade or business or any property held by the foundation for more than one year should not be considered as a short-term capital gain. Any losses incurred by the foundation due to the sale or exchange of any of the above-mentioned properties should be included as 'Other Expenses' in Form 990-PF.
B, a private foundation had bought a building worth $7000 in the year 2019. B had experienced some losses during 2019 and decided to sell the property in the same year. B sold the property whose value has gone up in a few months to D for $9000. The net short-term capital gain of this property is $2000.
If the organization incurred net short-term capital gain, enter -0- in Line 8 of Part I in Form 990-PF.