To: Jonathan S. Feingold who wrote (58185 ) 1/13/1999 8:44:00 PM From: David Colvin Read Replies (1) | Respond to
Shouldn't I be able to declare up to a $ 3,000 tax loss for the worthless Syquest stock for the 1998 tax year. Why did you say that they would go into the 1999 tax year. Please let me know. only to the extent of the gains. For example, let's say you sold a stock in 1998 and incurred a $100,000 capital gain. You can counter/offset the entire $100,000 gain with $100,000 worth of losses (if you have them), plus an additional $3000 that can go into the right-hand column as a negative $3,000 for purposes of calculating your taxable income. In this example, if you had losses exceeding $103,000 the remainder goes on another IRS schedule form and is considered a "tax loss carry forward" that can be used next year to offset gains.could have sold your shares even if you wanted to. The problem is you can't sell the stock because it's simply not trading.You can get the stock declared worthless - your brokerage should file the appropriate forms for you in order to start the process (at least my brokerage house, Fidelity Investments, will do it). They have advised me that this can be a long, drawn out process....sometimes taking in excess of a year and taking court order.You can instruct your brokerage to order certificates for you, even when the stock isn't trading - registering them in your name, and send them to you. Some brokerages charge a small fee for this based on the number of shares (Fidelity doesn't). Then, when you get your hands on the certificates the stock will be removed from your brokerage account statement. You can then sell them to a friend for $1 and record the loss as being the difference between your cost basis (what you originally paid for the stock, including commissions) and $1. You don't have to have a broker to sell your certificates. It's perfectly legal to sell them yourself to anybody you want to....similar to selling your own house without a real estate agent being involved. The problem is, it's already 1999 and you must declare the loss in the year in which the actual loss occurred.
