Serious question concerning Capital Gains versus Dividend Distribution - Postitve Responses Appreciated!
I had a company go BK a few years back and take any yearly stock capital gains and deduct them from that huge lost. Of course you can only deduct a max of a -$3k per year and the rest gets carried over for future tax years.
I would think that at least a portion of this special divident will be declared as a Capitial Gain.
If so, will I be able to deduct that portion that is listed as a capital gain from my carry-over capital losses? I know the answer would be yes if this was a capital gain on the stock's price, but does it also hold true in the case of a special dividend?