Q: I bought stock years ago in a company that recently merged into another company. The shares I received back are worth less than my original cost. Can I deduct that as a capital loss? J.S., Park City, Utah
A: Yes, you can after you sell those shares. For instance, if you acquired 1,000 shares at $10 a share and sell them at $8 a share, you can claim a $2,000 loss. You can use that loss to offset your capital gains and then up to $3,000 of ordinary income. Tip: Be careful of the "wash sale" rule. If you reacquire "substantially identical" shares within 30 days of the sale, you can't deduct the loss.
- Small Business Tax Deduction Strategies No matches