club_cafe: Re: How to report bankruptcy of a stock

iras1 on

The first poster in this thread may or may not be holding a worthless stock (we don't know what company it is).

Albert St. Onge's club definitely holds a worthless stock. You don't need any additional tax schedules to deal with a worthless stock beyond Schedule D which is used for all stock transactions. The correct IRS procedure is to enter "worthless" in the date sold and sales proceeds columns, but entering a sale for $0 on 12/31 accomplishes the same thing.

Ira Smilovitz

In a message dated 02/19/03 9:45:21 AM Eastern Standard Time, juan.mostek@kellogg.com writes:

Your broker is obligated to make a trade as long as the stock is listed on
the BB or pink sheets. Lets say you own a 100 shares of a stock trading at
.01. Your trade would net $1.00 less commissions. My broker has a policy to
not charge a commission in excess of the proceeds, so they would net the
dollar and you could then reflect the trade as a net proceed of zero. You
can at least then claim the loss on your taxes.

There is a way to take a loss in the event you do not make the trade and the
equity becomes worthless (no market available). You need to contact a tax
advisor in this situation as it entails additional tax schedules.

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