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I was told by a fellow investor that he was selling securities which he took a 40%+ loss on so he could take a tax write off... Somebody else told me that you still have to report a sale of a security as income when you file even if it represents only 60% value of your intital investment and even if you re-invest it. I'm confused.

Gee, I can't imagine why <g>. When you sell an investment you report the sale on Schedule D of the 1040. The difference between the sale proceeds and your basis is your gain or loss on the sale. You can see how this works on Schedule D and in Publications 550 and 551. You can read about netting gains and losses and the limits on capital losses in the FAQ.

Phil Marti
VITA Volunteer
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