abandon

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Abandon

1. To decide not to exercise an option. This occurs when an option is out-of-the-money on the exercise date. That is, one may abandon an option if it is currently unprofitable and thus highly unlikely to become profitable.

2. To withdraw one's claim to an asset, especially an unprofitable one. Corporations must file appropriate paperwork with the government to abandon assets. Alternatively, an individual may abandon both real and personal property. For example, a homeowner may leave his/her house and never intend to return. A squatter may then come to possess the home through adverse possession. An important component of abandonment is the owner's intent never to return or otherwise possess the property again.

3. To opt out of a forward contract according to the procedure specified therein. When one abandons a forward contract, one does not buy or sell the underlying asset and it is not delivered.

abandon

To elect not to exercise an option.
References in periodicals archive ?
Assuming a taxpayer will benefit from abandoning a property, how can this be done?
When abandoning a partnership interest, a partner claims a loss for that interest's value.
LANCASTER - Carolyn Phipps is accustomed to people abandoning dogs in the desert around her house.
However, the Fifth Circuit decision in Echols(1) and its later per curiam decision on the IRS's appeal of the original decision have highlighted the possibility of claiming a loss deduction on the worthlessness of a partnership interest without also abandoning the interest.
Former state and county environmental regulator Angelo Bellomo, who played a key role in exposing similar dangers that led to abandoning Belmont after $175 million had been spent, said the system of regulatory protections is seriously flawed.
1398(f)(2), and the trustee shifted the tax consequences of foreclosure to the debtor by abandoning the property.