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Subject Author Date
worthless bond Dan Lanciani 04-14-2008
| ---> Re: worthless bond Stuart Bronstei...04-15-2008
| `--> Re: worthless bond Stuart Bronstei...04-17-2008
Posted by Stuart Bronstein on April 17, 2008, 3:05 am
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 ddl@danlan.*com (Dan Lanciani) wrote:

> One detail of the timing I would really like to clarify.
> Commentators state that you cannot make a worthless security claim
> as long as there is litigation pending that might lead to
> recovery. Does this mean that the security is not worthless until
> the litigation is finished (in which case you make the claim in
> the year the litigation dies)? Or does it mean that you have to
> wait for the litigation to die before making the claim, but the
> claim may still be for some past year when the security actually
> became worthless? In the latter case it seems that if the
> litigation goes on for more than seven years (which might be the
> case here) you are out of luck.

My guess is that it's not considered worthless until after the
litigation is completed. And once that happens, the determination is
not retroactive. I have not researched this specific issue, however.

Stu

--
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Posted by Seth on April 23, 2008, 2:43 pm
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>
>I own some Holmes Harbor munis (Google if you want to see the horrible
>details) which have been the subject of years of class-action litigation.
>This year a final appeal to the state supreme court was denied and the
>lawyers determined that the case is dead. I would like to recognize my
>loss.
>
>The bonds are held at Fidelity. Fidelity has some sort of procedure
>to determine whether a security is worthless so it can be "removed"
>from an account. Unfortunately, after a month or so they determined
>that the security isn't worthless (though it can't be sold).

>What's the best strategy to handle this?

There used to be somebody here who offered to buy any such securities
for $1. If he doesn't speak up, I'll make that offer. The sale to an
unrelated party lets you close out the transaction for a capital loss,
whether or not the securities are worthless (however anybody defines
that).

Seth

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Arthur Kamlet on April 23, 2008, 3:08 pm
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>>
>>I own some Holmes Harbor munis (Google if you want to see the horrible
>>details) which have been the subject of years of class-action litigation.
>>This year a final appeal to the state supreme court was denied and the
>>lawyers determined that the case is dead. I would like to recognize my
>>loss.
>>
>>The bonds are held at Fidelity. Fidelity has some sort of procedure
>>to determine whether a security is worthless so it can be "removed"
>>from an account. Unfortunately, after a month or so they determined
>>that the security isn't worthless (though it can't be sold).
>
>>What's the best strategy to handle this?
>
>There used to be somebody here who offered to buy any such securities
>for $1. If he doesn't speak up, I'll make that offer. The sale to an
>unrelated party lets you close out the transaction for a capital loss,
>whether or not the securities are worthless (however anybody defines
>that).


I've been making that offer for quite a few years now, and
continue to make it. But only if you are absoluely convinced
they are worthless.
--


ArtKamlet at a o l dot c o m Columbus OH K2PZH

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Ernie Klein on April 23, 2008, 3:36 pm
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wrote:

> >
> >I own some Holmes Harbor munis (Google if you want to see the horrible
> >details) which have been the subject of years of class-action litigation.
> >This year a final appeal to the state supreme court was denied and the
> >lawyers determined that the case is dead. I would like to recognize my
> >loss.
> >
> >The bonds are held at Fidelity. Fidelity has some sort of procedure
> >to determine whether a security is worthless so it can be "removed"
> >from an account. Unfortunately, after a month or so they determined
> >that the security isn't worthless (though it can't be sold).
>
> >What's the best strategy to handle this?
>
> There used to be somebody here who offered to buy any such securities
> for $1. If he doesn't speak up, I'll make that offer. The sale to an
> unrelated party lets you close out the transaction for a capital loss,
> whether or not the securities are worthless (however anybody defines
> that).

How does one go about selling a bond (or any other security for that
matter) that is held (book entry) by a broker to an specific individual?
There is no physical bond, just as there are no stock certificates for
most companies anymore.

--
-Ernie-

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Rich Carreiro on April 23, 2008, 4:10 pm
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> How does one go about selling a bond (or any other security for that
> matter) that is held (book entry) by a broker to an specific individual?
> There is no physical bond,

I imagine you would "simply" instruct your broker to transfer the
bond to account of the purchaser. Of course, that'll probably
take paperwork and signature guarantees :)

> just as there are no stock certificates for most companies anymore.

I don't think that's true quite yet.

--
Rich Carreiro rlc-news@rlcarr.com

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

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