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Non-Tech : Littlefield Corporation (LTFD) -- Ignore unavailable to you. Want to Upgrade?

To: Max Fletcher who wrote (5368)	12/10/1997 9:25:00 AM
From: Dale Baker	Read Replies (1) \| Respond to of 10368

If someone has the time, why don't you call the IRS help line and try to get an answer? I haven't been able to get into their Web site from here but they have been touting their new customer-friendly attitude since Congress whomped them a few weeks ago.

To: Max Fletcher who wrote (5368)	12/10/1997 3:53:00 PM
From: Nittany Lion	Respond to of 10368

Max, I don't think this is an issue which can be confirmed for sure. Keep in mind that tax laws are just like any other laws, i.e. Congress passes the laws and then it is up to the IRS to interpret them. If a taxpayer disagrees then ultimately it is decided by the courts, I have found no court cases on this subject (that does not mean that there aren't any). The best material I have found, and it has been posted before, is the following: <<"The wash sale provisions apply to the denial of a loss if the securities acquired are substantially identical to those sold or disposed of. For example, when a taxpayer sells a stock purchase warrant at a loss and, within 30 days, purchases stock in the same corporation, the wash sale rules apply only where the relative values and price changes are so similar as to make the stock warrant substantially identical to the newly acquired stock." >> The word "only" in the last part implies to me that more often than not this situation will not result in a wash sale. I think Dax and I have agreed on this (and a poster on the "income tax thread" also - read posts 207 forward). However, it is a matter of interpretation. If you call IRS as Dale has suggested, ask for the technical section and ask for their opinion in writting - I don't think their answers are wrong as much as 50% but it could be close(caveat emptor). If they give you an answer which later on causes you to pay additional tax, you will not be charged any penalty(of course you must be able to prove this). Print this and show to your own accountant for his/her opinion on the subject. Gary