bought stock in 1996 for $3400 and sold in 2006 for $340 how does this effect my 2006 taxes?

Question

is it part of capital gains loss

Answer 1

Wayne Z offered the correct answer if the transaction you describe is the only such item on the schedule of capital gains and losses for the tax year during which the sale was made. The relevant detail omitted is that the $3,000 he mentions refers not to the total amount of losses to be summed with gains, but to the total amount of capital loss that can be applied in the same tax year, any excess beyond which is carried over, applicable to successive calendar tax years.

That is, you could have recorded a $15,000 capital loss and a $10,000 gain during the same tax year, the net of which $3,000 could be applied in that tax year and $2,000 the next.

Answer 2

Yes, it's a long-term loss. Fill out the whole schedule D and it will tell you what to do with the loss. If your net loss is over $3000, you'll only be able to write off $3000 of regular income against it this year, and would have to carry over the other $60 to next year - that's not as hard as it sounds.

Answer 3

The loss ($3060) is calculated on Schedule D. If this is your only transaction, you would deduct $3000 in 2006 and $60 in 2007 due to the $3000 limit on losses.

Most software programs should do this rather easily.

Also, remember to add you commissions paid on the purchase and the sale to the cost.

Answer 4

ah ha! another Lucent shareholder. I must be a masochist; I'm still hanging on to mine. It's a capital loss and it will raise your refund, probably $50.