MTEI - Mountain Energy - No BASHING Allowed Message Board

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Microcap & Penny Stocks : MTEI - Mountain Energy - No BASHING Allowed

MTEI 0.00400

-14.9%

Nov 18 9:31 AM EST

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To: Brukie who wrote (11150)	11/20/1998 2:50:00 AM
From: ~Owl	Read Replies (1) of 11684

It may not require that we work with Tow, but maybe just in Tow's best interests, just perhaps? (lifted from RB MTEI board) In regards to MTEI's possible Section 1244 status, (that is ability to write off 100% verses the normal $3,000.00/year limit) I'm afraid I have to say it does not qualify for the following reasons: 1)For the five years preceding the loss the corporation must have received more than 50% of its gross receipts from business operations. ICVI/MTEI and previous incarnations derived most (in some cases all) income from sale of stock. 2)Individual shareholders must have acquired their Section 1244 stock at original issue. Reverse merger presupposes pre-existant corporations, unlike IPO or venture capitalization. Even the 19 million suspected illegal shares were issued in ICVI's name and later exchanged for MTEI shares. 3)Again, reverse-mergers do not qualify; (see URL reference below) smbiz.com One of the easiest provisions to run afoul of is the requirement that the loss can only be taken on stock issued for money or property (other than stock or securities) and only to the original purchaser of the stock. The last requirement means that only stock purchased from the company on original issue qualifies. Look at the definition above. Only stock issued for money or property other than stock or securities. Thus,contributing a note to the corporation in exchange for stock will not qualify. The same is true of simply exchanging stock. Nor can you get the benefits by contributing services to the business. Sorry, I wish I could write my loss off too. ~Owl. . . me, too.

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