A worthless security had a holding period of 6 months when it became worthless on December 10,2014.The investor who had owned the security had a basis of $20,000 for it.Which of the following statements is correct?

Question

Quizplus · Accepted Answer

Section 165(g)(1)provides that if a security becomes worthless during the tax year,the loss is treated as if it occurred on the last day of the tax year.On the last day of the tax year,the security would have been held for less than a year.

A Worthless Security Had a Holding Period of 6 Months