I own stock in a company that went bankrupt. What does fool have to do to claim the loss to the tax man.
donsena writes: I own stock in a company that went bankrupt. What does fool have to do to claim the loss to the tax man.I reply:Take a look at the Taxes FAQ for details, but the practical answer is to sell it to a relative for a dollar. Once in a great while, the stock of a bankrupt company rebounds; when that happens, it's nice to keep the profit in the family. Also, because of this possibility (among others), it can be difficult to convince the IRS that the stock really was "worthless," and that it became so in the tax year for which you're claiming the loss. Good luck! --Bob
I own stock in a company that went bankrupt. What does fool have to do to claim the loss to the tax man.***The fact that the company went bankrupt does not mean that your shares have become worthless. It could take years for that to happen and the stock could even rebound to become a real winner. To take the loss you could sell the stock to a broker who might be willing to take it off your hands. There was a thread on this very subject between May 3 & May 5, 1999. In his post #15295, dated 5/5, TMFTaxes suggests you sell to a relative (not blood related), for pennies, in order to take the loss. If the stock ever were to rebound, the gains would be kept in the family. Just remember that the loss will not be allowed if you sell to any member of your family (brother, sister, spouse, ancestor, or lineal descendant)."Jack"
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