| Grex > Finance > #28: Capital loss write-off |
| Capital loss write-off | 
Feb 4 17:15 UTC 2003 |
hmmmm.... I was hoping someone can point me in the right direction. I bought 500 shares of XOXO back in October 2001 for around a $1/share. A few weeks later, trading was halted and eventually the stock was delisted and put on OTC BB. I figured I was going to hold on till the bitter end..... Well that end has finally came. As of 16 Jan 2003 the stock stopped trading. now here's my problem: According to Yahoo! ( http://finance.yahoo.com/q?s=xoxoq.ob ) the stock was last traded at $.07/share. Ameritrade (formerly Datek) is showing the ticker symbol to not exist and a final price of $0.00...so what should I list on my write-off 0 or 7 cents? Also (and probably most importantly) how do I prove the this stock is esentially worthless to the IRS i.e - what documentation should I have on hand as evidence? Can a capital loss be used to offset you regular earned income or only against capital gains?
| response 1 of 2: |
Feb 11 02:37 UTC 2003 |
IANAE (i am not an expert), but i'd say to peek over IRS publications 544 & 550 on the IRS web site first. If that doesn't make it clear, call the IRS (800-829-1040). Looking at a copy of Schedule D, it appears that the first $3K/year of capital losses can be used against regular income, more than that can count against capital gains or (????) future year's income.
| response 2 of 2: |
Feb 20 16:27 UTC 2004 |
well, I'm writing off my two non-performing stocks this tax year (2003). I did some more research and according to the IRS pub 550 (pg 36): Stocks, stock rights, and bonds that became worthless during the tax year are treated as though they were sold on the last day of the tax year. Schedule D is super confusing this year.