How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Merlo Your Own Question
Merlo
Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
9573734
Type Your Tax Question Here...
Merlo is online now
A new question is answered every 9 seconds

AIG resently effected a reverse split and I lost a huge number

Customer Question

AIG resently effected a reverse split and I lost a huge number of shares. Can I deduct that in my 2009 taxes?
Submitted: 7 years ago.
Category: Tax
Expert:  Merlo replied 7 years ago.
Hello proconiny,

A reverse stock split reduces the number of shares and increases the share price proportionately. So the actual value of your stock should not really have been affected.

However, even if the total value of your stock is now lower or higher than it was before, you cannot report any gain or loss until the year the stock is actually sold. It will not be until you sell the stock that you will really know what your actual gain or loss is.

When a stock goes up in value you do not pay tax on the increased value until you sell the stock. The same principle applies to any loss in value.

If this was helpful please press the Accept button. Positive feedback is also appreciated.

Thank you proconiny.