I know that capital losses cannot offset ordinary income. But I'm wondering about the opposite. Can capital gains be reduced by ordinary losses?
For example, let's say my corporation made $100,000 profit by selling stocks and bonds. But it lost $25k in expenses like payroll, marketing etc. So is the taxable income $100k or $75k? I'm guessing it's $75k since capital gains are taxed as ordinary income. But I want to make sure that's the case.
(note: this is for a C Corporation)
Yes that should be correct.
See Pub 542 for more information and also the instructions for F1120
Going through F1120, capital gain is included in the total income section.
Deductions are listed below. In your example, barring any "limited" deductions, taxable income should be $75K.