No unless you can establish that the stock is indeed worthless.
Delisting does not necessarily make the stock worthless (although the company is probably not in good shape at this point). Regardless of the reason for the company's delisting, you would still need to sell these stocks through your broker in order to claim the losses in most cases.
Delisting does mean the you can no longer sell these shares in a normal transaction. For a period of time, though, it's likely that speculators will be willing to purchase shares at some dirt-cheap price through a quotation system known as the pink sheet. As a result, your shares are not completely worthless. They're just nearly worthless.
So to establish your loss you will need to sell these shares to your broker for some nominal amount. However, if the company is insolvent and you have documentation to establish this fact, you may be able to take the loss in the year the company no longer exists. You will want to contact your broker to see if the company for which you hold these stocks is indeed worthless.
If your stock meets the IRS guidelines for being a worthless stock, you will report this worthless stock in
TurboTax Online or Desktop using the follow these steps:
- Once
you are in your tax return, click on the “Federal Taxes” tab
("Personal" tab in TurboTax Home & Business)
- Next click on “Wages &
Income” ("Personal Income" in TurboTax Home & Business)
- Next click on “I’ll choose
what I work on” (jump to full list)
- Scroll down the screen until
to come to the section “Investment Income”
- Choose “Stocks, Mutual Funds,
Bonds, Other” and select “start’ (or “update” is you have already worked
on this section)
- The first screen will ask if
you sold any investments during the current tax year - yes
- Even though you did not receive a
1099-B, answer “yes” to the 1099-B question
- Select you will type in the information yourself
- Select box B or E (if short-term or long-term respectively)
- Enter your stock information and use a "0" for sales proceeds.
- Select the box for uncommon situation and select start
- Choose uncommon situation and choose "stock"
- You will be asked various questions about this stock transaction.
- You will get to a screen titled "Do any special situations apply to this sale?" - select "worthless stock" (screenshot)
