Hello my question lies in the fact that generally restricted stock units are non - deductible from my prior research efforts. My situation is slightly different from what I have seen. The company in question now is bankrupt, the taxpayers were taxed on the value of the restricted stock units by their employer including that total in the gross wages of their w-2. My understanding is that once they are included in gross income means that they have been exercised. My questions are is the capital loss deductible if this is not the case? What is the purchase date for this purpose?

Thank you in advance

I think you have some deductible capital losses, that is the difference between the basis (the aggregate amount invested for the restricted stock that you paid through your regular payroll over the years) and market value (Zero, now that the company is bankrupt!).

You should be able to deduct as capital losses the entire value of the amount that you invested in the restricted stock, especially now since the company is bankrupt. Also, remember that fact that you were also taxed on the these restricted options.

I would certainly consult a CPA experienced in this arena as he can better calculate your correct basis and maximize your allowable capital losses from the bankruptcy of the company!

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Would you also deduct the amount of dividend equivalents that were paid in relation to the restricted stock units?