Can I claim a deduction for paying margin calls?

March 5, 2003

Subject:  Margin calls
From:  Jody
Date:  Sat, 8 Feb 2003

Good Morning:

How do I report for tax purposes the payment of some margin calls? I already know how to report margin interest, but not the actual loss of paying the margin itself as I had to 1) sell some stock to cover and 2) send a check to cover the call.

I appreciate any help that you can give me!



Date:  28 Feb 2003

Hello Jody,

Paying a margin call is not tax deductible. It is the repayment of a debt. If you sell stock at a loss to get the cash to pay the margin call, the stock sales and related capital losses are reported on Schedule D.

Good luck!
Mike Gray

For answers to new questions, subscribe to our newsletter, Michael Gray, CPA's Tax & Business Insight by filling out the form below.

Home    Newsletter Archive    Introducing Michael Gray, CPA    Articles    Tax FAQ   Need Help?    Other Links

Michael Gray, CPA
2482 Wooding Ct.
San Jose, CA 95128
(408) 918-3162
FAX: (408) 938-0610
Hours: 8am - 5pm PDT Monday - Friday

Find us on Facebook
Follow me on Twitter
Connect on LinkedIn
Our Blog

Subscribe to Michael Gray, CPA's
Tax & Business Insight

We respect your email privacy