In 1993, Mr. L paid $18,000 for a newly issued BN bond with a $30,000 stated redemption value. He has recognized $6,000 of the original issue discount (OID) as ordinary interest income. This year, BN went bankrupt and informed Mr. L that his bond was worthless. Identify the tax issue or issues suggested by the above situations, and state each

In 1993, Mr. L paid $18,000 for a newly issued BN bond with a $30,000 stated redemption value. He has recognized $6,000 of the original issue discount (OID) as ordinary interest income. This year, BN went bankrupt and informed Mr. L that his bond was worthless.

Identify the tax issue or issues suggested by the above situations, and state each issue in the form of a question.