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Microcap & Penny Stocks : GIFS -- Ignore unavailable to you. Want to Upgrade?

To: Mike who wrote (7362)	3/5/1998 11:39:00 PM
From: Arcane Lore	Respond to of 8012

"I have a TAX question:" The following posts may be of interest: #reply-3458498 #reply-3494622

To: Mike who wrote (7362)	3/6/1998 7:14:00 PM
From: Tom W	Respond to of 8012

I'm not a tax expert, so this comment is worth no more than what you paid for it (without any allowance for SI's fees). A loss is a loss, when there is no hope of recovery. Once a company has gone out of business and assets will not begin to cover liabilities, it's a loss. For IRS purposes, it's best to get a letter from your broker dated at the end of your tax year stating that the stock is either worthless (as in GIFS) or the limited value still remaining is less than what the costs would be to sell it. Once you have claimed your cost basis as a total loss, your cost basis becomes zero even tho you still own the shares. If, by some miracle, you later recover any money from the shares, then that becomes a net profit (whatever you get minus zero) and is taxable and reportable according to the tax laws then in place. In the case of GIFS, I didn't even bother getting the letter as I feel I have ample documentation of the seizure of the co by TN, and its liquidation value compared to liabilities, to satisfy any IRS audit. I have taken my loss against other gains and ordinary income, and would be delighted sometime in the future to have to report some recovery as income. tom w