Tax loss

  • “If I sell a stock now at a big loss (down about 70–75%, around $4,000 lost from my $5,500 investment), versus holding through a bankruptcy restructuring where I’d only get a tiny payout (maybe 2–3% of current value, less than $100, and my shares would be heavily diluted), how is the loss treated for tax purposes? Can I claim the loss based on my original purchase cost, or only after the dilution/restructuring? And which option is usually better to minimize losses?