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Richard - Bizlaw
Richard - Bizlaw, Attorney
Category: Business Law
Satisfied Customers: 10628
Experience:  30 years of corporate, litigation and international law
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In 2008, I took money out of stock, that I purchased at $55

Customer Question

In 2008, I took money out of stock, that I purchased at $55 a share. At the time the stock was srlling for $11.00 a share. Naturallu this used up a lot of the stock. I have been told to claim this. How do I do this for the 2009 and 2010 ? a
Submitted: 6 years ago.
Category: Business Law
Expert:  Richard - Bizlaw replied 6 years ago.
How long did you own the stock before selling any shares?
Customer: replied 6 years ago.
Purchased in 4/2007 by my husbannd with my 401k ,
I did not realize this to 2008.I recently settled this,and was repaid what I lost,except for the stocks i sold,
Expert:  Richard - Bizlaw replied 6 years ago.

Was the stock sold inside the 401K plan or was the money removed and the stock purchased outside the 401K plan? If the stock was purchased within the plan, there are no tax consequences because gains and losses within the plan are not recognized. However, if you purchase and sold the stock outside the plan, then you to recognize the gain or loss on the sale. If the stock was held for one year or longer the loss is considered a long term capital loss. The loss is recognized in 2008. Long term capital losses are used to offset long term capital gains up to the full amount of the loss. If the loss is not fully utilized in 2008 then up to $3,000 of the loss can be used to offset short term capital losses and ordinary income. In your case, the loss would be reflected on your 2008 tax return. If not fully utilized the long term capital loss can be carried forward to future years. If your 2008 return was filed, it can still be amended to reflect the loss as can your 2009 return if there is a carry forward of the loss from 2008.


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