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This is a really easy question. I own some shares of Citadel Broadcasting. (Citadel was company that was spun off from Disney.) The statement from the broker says "NP" for their market value; the broker says the company went bankrupt (in 2010) and the stock is no longer trading.

I've never had stock in a company that went bankrupt before, but I figure that I what I should do is compute my cost basis in Citadel and then take that amount and enter in Schedule D as a capital loss.

This is what to do, isn't it?

Pretty much. Enter the transaction as a sale for $0. You can either list 12/31/10 as the date of sale or enter "worthless" if your software will allow it.

The key factor that differentiates your situation from other bankrupt companies is that Citadel did officially cease trading and is completely worthless.

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