To all - tax treatment of GIFS:
As the lone tax accountant who lived through the entire GIFS mess firsthand, let me respond to the plethora of e-mails I have received regarding our GIFS loss.
Before I begin, let me state that parts of this analysis get semi-technical. If anyone has any questions, please let me know. I sold most of my shares for a loss, but do currently own 5,000 shares that are about as worthless as they come.
When a security becomes worthless, you are deemed to have sold the security on the last day of the tax year the security became worthless. I am not sure the date this whole thing blew up, but I know it was late April. For those who sold the shares, your sale date is the date you sold the shares. If you held to the bitter end, your shares technically became worthless and sold on December 31, 1997 even though the SEC ruling essentially caused the stock to become worthless in late April.
To claim the loss, basically fill out Schedule D. As noted above, the holding period for short-term or long-term basically stipulates whether you report the loss on part I or Part II (Remember, you are deemed to have sold the security, for holding purposes, on December 31 if you have worthless certificates.) When completing Schedule D, basically write worthless for columns C and D (date of sale and sales price). For support, I am actually attaching a few of the press releases relating to the SEC shutdown, etc. etc. primarily because I will be claiming a large loss. Unlike most people, I have not calculated my loss yet, though I figure it is around 14K, which is why I am attaching additional documentation.
Again, if anyone has any questions, please do not hesitate to contact me. I apologize in advance if it takes a few days to get back to you, but I am obviously working 14-16 hour days during the next few weeks. I probably will not be checking the thread so just e-mail me at my regular address.
Have a good day all. Regards, mtm |
