A corporation bought its first property, a vacant lot (#1) in 2015 for $200K, and vacant lot #2 in 2018 for $500K. These properties don't generate any income; therefore, as of 2020, the corporation has $120K in retained earnings (combined loss from these 2 properties).
On 1/1/ 2021, vacant lot #2 was sold for $620K.
Lot #2 sales price $620K - $500K purchase price = $120K gain from sales of lot #2
Can the gain from sales of lot #2 (120K) be net off with loss carry forward ($120K) so that the corporation has no capital gain in 2021?