A taxpayer owned 1,000 shares of common stock in Barlo Corporation, which manufactures automobile parts. The taxpayer’s cost basis in the stock was $82,700. Last week, Barlo declared bankruptcy and its board of directors issued a news release that Barlo common stock should be considered worthless. Determine the character of the $82,700 loss if the taxpayer is:
a. An individual who purchased the stock as an investment.
b. A corporation that purchased the stock as an investment.
c. Barlo’s parent corporation that owned 96 percent of Barlo’s outstanding common stock.