Barbara owns 100 shares of Bond Corporation stock with a basis of $40,000. Barbara receives two liquidating distributions, including $16,000 paid last year and $20,000 paid in the current year. An additional distribution of an undetermined amount is expected next year. On last year's tax return, Barbara can recognize a loss of

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Barbara cannot recognize a loss until the liquidating distributions exceed her basis in the stock. Since the total distributions so far ($16,000 + $20,000 = $36,000) are less than her basis ($40,000), no loss is recognized yet.

Barbara Owns 100 Shares of Bond Corporation Stock with a Basis