Realized Loss


Realized Loss
A loss is recognized when assets are sold for a price lower than the original purchase price. Realized loss occurs when an asset which was purchased at a level referred to as cost or book value is then disbursed for a value below its book value. Although the asset may have been held on the balance sheet at a fair value level below cost, the loss only becomes realized once the asset is off the books.

One upside to a realized loss is the possible tax advantage. In most instances a portion of the realized loss may be applied against a capital gain or realized profit to reduce taxes. This may be quite desirable for a company looking to limit its tax burden, and firms may actually go out of their way to realize losses in periods where their tax bill is expected to be higher than wished.


Investment dictionary. . 2012.

Look at other dictionaries:

  • realized loss — realized gain or loss Gain (or loss) resulting from an identifiable event, such as a sale or an exchange of property. The amount of realized gain from the sale or other disposition of property is the excess of the amount realized over the… …   Black's law dictionary

  • realized loss — A capital gain or loss on securities held in a portfolio that has become actual by the sale or other type of surrender of one or many securities. Bloomberg Financial Dictionary * * *    The cash loss from liquidating a position …   Financial and business terms

  • realized gain or loss — Gain (or loss) resulting from an identifiable event, such as a sale or an exchange of property. The amount of realized gain from the sale or other disposition of property is the excess of the amount realized over the adjusted basis of the… …   Black's law dictionary

  • realized gain — or loss Gain (or loss) resulting from an identifiable event, such as a sale or an exchange of property. The amount of realized gain from the sale or other disposition of property is the excess of the amount realized over the adjusted basis of the …   Black's law dictionary

  • loss — n 1: physical, emotional, or esp. economic harm or damage sustained: as a: decrease in value, capital, or amount compare gain b: an amount by which the cost of something (as goods or services) exceeds the selling price compare …   Law dictionary

  • realized gain or loss — n. Actual and identifiable gain or loss received by selling property or an investment. See also recognize The Essential Law Dictionary. Sphinx Publishing, An imprint of Sourcebooks, Inc. Amy Hackney Blackwell. 2008 …   Law dictionary

  • realized profit/loss — A profit or loss that has arisen from a completed transaction (usually the sale of goods or services or other assets). In accounting terms, a profit is normally regarded as having been realized when an asset has been legally disposed of and not… …   Accounting dictionary

  • realized profit-loss — A profit or loss that has arisen from a completed transaction (usually the sale of goods or services or other assets). In accounting terms, a profit is normally regarded as having been realized when an asset has been legally disposed of and not… …   Big dictionary of business and management

  • realized profit or loss — A capital gain or loss on securities held in a portfolio that has become actual by the sale or other type of surrender of one or many securities. Bloomberg Financial Dictionary …   Financial and business terms

  • realized profit — A capital gain or loss on securities held in a portfolio that has become actual by the sale or other type of surrender of one or many securities. Bloomberg Financial Dictionary …   Financial and business terms


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