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bala
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Joined: 09 Jan 2009
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Posts: 355

Posted: 20 Mar 2009 at 22:23 \| IP Logged

For a cash basis taxpayer, gain or loss on a year-end sale of listed stock arises on the:
a)Trade date.
b)Settlement date.
c)Date of receipt of cash proceeds.
d)Date of delivery of stock certificate.

ans is a. can someone please help me understand this?

shalgo
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Joined: 27 Dec 2007
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Posts: 105

Posted: 21 Mar 2009 at 16:11 \| IP Logged

According to me if stocks are listed then gain or loss arises on trade date for both accrual and cash basis taxpayer.

I may be wrong because i studied this 2 month ago and may have forgot something.

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shalgo
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Posted: 21 Mar 2009 at 16:34 \| IP Logged

I checked in the book and wiley says that if stock that are traded on an established securities market are sold,any resulting gain or loss is recognized on the trade date(the date on which trade is executed) for both cash and accrual method taxpayer.

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bala
Major Contributor

Joined: 09 Jan 2009
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Posts: 355

Posted: 21 Mar 2009 at 21:37 \| IP Logged

Thanks shalgo, appreciate your help!

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