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Posted by removeps-groups@yahoo.com on April 24, 2008, 10:26 am
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> How does one go about selling abond(or any other security for that
> matter) that is held (book entry) by a broker to an specific individual?
> There is no physicalbond, just as there are no stock certificates for
> most companies anymore.
There are electronic stock certificates. Even the money in your bank
is probably mostly in electronic form, though I don't know for sure.
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Posted by Dan Lanciani on April 24, 2008, 4:01 pm
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(Ernie Klein) writes:
| 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?
I asked about transferring it to another account but they were (as usual)
a bit vague. I think the only way to find out is to try. N.B. They
obviously know that this bond has serious (perhaps unprecedented for a
muni) problems. People went to federal prison. I get victim notifications
about locations and parole hearings and such. Some company sends me
letters about how they can help me (for a nominal fee, I'm sure) claim an
investment fraud loss to accellerate deduction. (I don't particularly
want to.) Overall a fascinating experience that I could have lived
without. :)
Dan Lanciani
ddl@danlan.*com
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Posted by Ernie Klein on April 24, 2008, 5:13 pm
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> ecklein@pacbell.net (Ernie Klein) writes:
>
> | 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?
>
> I asked about transferring it to another account but they were (as usual)
> a bit vague. I think the only way to find out is to try. N.B. They
> obviously know that this bond has serious (perhaps unprecedented for a
> muni) problems. People went to federal prison. I get victim notifications
> about locations and parole hearings and such.
Many (perhaps most) muni bonds are insured. I owned a bond many years
ago (not a muni) where the company went belly-up due to fraud and people
went to jail. Litigation took years, but almost 8 years later I
received a 4 digit settlement check -- the bond was still a large loss,
but far from worthless even though it had been deemed worthless and
couldn't be traded.
I seem to recall reading something at the time that the bond couldn't be
sold because it was an interest bearing investment and because the
issuing company was in default (and bankrupt) and the company could
never pay the interest, and because there was interest due, the bond
could not be traded because it actually had a negative value - anyone
buying it would have to pay the accrued interest but would not be able
to ever recover that interest.
--
-Ernie-
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Posted by Seth on April 25, 2008, 5:49 pm
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>I seem to recall reading something at the time that the bond couldn't be
>sold because it was an interest bearing investment and because the
>issuing company was in default (and bankrupt) and the company could
>never pay the interest, and because there was interest due, the bond
>could not be traded because it actually had a negative value - anyone
>buying it would have to pay the accrued interest but would not be able
>to ever recover that interest.
That's wrong. When a company files bankruptcy, its bonds trade
without accrued interest, but they still trade.
Some broker might not have been able to handle it, so they said it
couldn't trade.
Seth
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Posted by Dan Lanciani on April 24, 2008, 3:48 pm
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| 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).
The reading I've done suggests that the loss on such a sale is not
allowed if the security is already worthless. I'm not clear on
whether that means worthless at the time of the sale (in which case
it is even more restrictive than simply entering "worthless") or
worthless in a previous year (same timing as entering "worthless").
Am I missing something?
Dan Lanciani
ddl@danlan.*com
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<< ------------------------------------------------------- >>
<< 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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