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Old 03-21-2009, 10:52 AM
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Join Date: Mar 2009
Posts: 4
Won Settlement against Stock Broker

I was awarded $100K for stock broker misconduct.
My brokerage account has unrealised loss of $250K.
Still holding till who knows when...

Is the cash settlement considered ordinary income,
or is it return of capital, or capital gain which could
be offset by capital loss if I sold losers to generate
a taxable event?

Is the settlement linked to my capital loss by means
of the settlement's basis and origin of claim?

What is proper tax treatment for my award?


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