Claiming capital losses on Lumen Technologies stocks

[mjc517]

Hi,

I've had telephone company stock since I started with Bell of Pennsylvania in 1980. US West was the original business at divestiture in 1984 but has been merged and sold several times since then. I've had quite a few shares over the years but now the stock is Lumen Technologies, and I have about 15 shares. I'd like to get rid of it but am unsure about how to claim the losses.

Thanks,

Mary

[Mike9241]

Lumn is not worthless. so to take a loss you'll have to sell all the shares you own. 

https://finance.yahoo.com/quote/LUMN/ 

[mjc517]

Thanks for getting back to me. I realize I have to sell first but am not sure how to figure out and claim a capital loss after I sell. 

[Opus 17]

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@mjc517 wrote:

Thanks for getting back to me. I realize I have to sell first but am not sure how to figure out and claim a capital loss after I sell. 

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You just need to know your original cost basis and the approximate date you bought or acquired the stock.  If the stocks are held with a broker, they may be able to help.  

If you or your broker don't have exact records then you need to do the best reconstruction you can and document your work in case the IRS asks.  (The only thing you put on your tax form is your cost, although you can be asked later for supporting proof.)

For example, if you bought the stock all at once, and are selling your entire holdings, then your cost is what you originally paid, regardless of how many mergers and splits there were.  You don't really need to figure out any basis adjustments.  However, if you previously sold part of your holdings, or if you are only selling part of your holdings now, you have more work to do to figure out the adjusted cost basis of your current holdings.  If you don't know, you can make reasonable estimates.  For example, if you bought 10 shares of Bell every year from 1980 to 1984, you could use the average price from the year.  You can get historical prices from Yahoo Finance, the Wall Street Journal, or by looking up old newspapers in your local library (might have to use the microfilm).   Yahoo Finance seems to have historical data for Lumen going back to 1980, although the web site crashes when I try to look it up, hopefully a short term glitch.

[VolvoGirl]

Also, if you have a loss, you can only deduct up to 3,000 per year.  The rest you will have to carryover until it is used up. Turbo Tax will do all the calculations and carryover the rest each year.  So if you have gains in another year you can apply the carryover to it and use more of it up.  

[mjc517]

Thanks for your response. I have more of these stocks, so I'll probably have losses for the rest of my life! 

Another question: I've looked at form 8949. Can I just put 273 shares of US West at the price on 1/1/1984, the date of divestiture, then fill in the amount of the proceeds from sale of Lumen? Seems like they're going to want an explanation.

I really appreciate this help.

Mary

[Opus 17]

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@mjc517 wrote:

Thanks for your response. I have more of these stocks, so I'll probably have losses for the rest of my life! 

Another question: I've looked at form 8949. Can I just put 273 shares of US West at the price on 1/1/1984, the date of divestiture, then fill in the amount of the proceeds from sale of Lumen? Seems like they're going to want an explanation.

I really appreciate this help.

Mary

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Just follow the form and instructions, or let turbotax handle it, the program will ask all the right questions.  You just enter the date, proceeds, and other requested information.  Don't attach proof not asked for.

https://www.irs.gov/forms-pubs/about-form-8949

I assume you will sell using a broker (and you will get a 1099-B) but that since these shares were purchased before 2010, the broker will not report the basis.  So you will check box B in part 1 of form 8949.  Report what you sold (Lumen or LUMN), not what you originally bought.  

If you have the purchase details, and you know how the shares tracked, you can report each purchase separately.  You can also choose to list the purchase date as "various" and enter the total price paid.  

If you need help with the prices and basis, you may want to discuss with a stockbroker or financial advisor to help you.  

[mjc517]

Thanks again!