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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: M. Dion who wrote (3203)	1/9/1999 1:48:00 AM
From: chester lee	Read Replies (3) \| Respond to of 122087

MD, <<You just never cover....The big bonus here is that since you haven't closed out the position, you have no taxable gain....thus no taxes.....Big time win without the consequences of a taxable gain (One of the few remaining loopholes...have to be super lucky....doesnt happen often).....>> Won't happen at all. THE IRS has revise the tax codes to also tax once lucky stiffs who found shorts that ran to zero. New rules requires you to pay tax on gains after the stock has reach substantial zero value, NOT absolute zero value. I'm no tax expert, but this rule I'm sure of. Here's what the IRS website says: <<Short Sales A short sale occurs when you agree to sell property you do not own (or own but do not wish to sell). You make this type of sale in two steps. You sell short. You borrow property and deliver it to a buyer. You close the sale. At a later date, you either buy substantially identical property and deliver it to the lender or make delivery out of property that you held at the time of the sale. You do not realize gain or loss until delivery of property to close the short sale. You will have a capital gain or loss if the property used to close the short sale is a capital asset. Exception if property becomes worthless. A different rule applies if the property sold short becomes substantially worthless. In that case, you must recognize gain as if the short sale were closed when the property became substantially worthless. >> irs.ustreas.gov Compliments of John from his thread: Message 7114237 chester