[nearbuy]

Why would driving the stock price to zero bankrupt a healthy company? Companies go bankrupt when they can't pay their debt. A low stock price may impact their ability to raise more capital by issuing more stock, but if the company is profitable, they'll still be profitable at a low share price.

An undervalued share price is also a great opportunity for the company (or anyone really) to buy back some of their stock. In that sense, by manipulating the price too low, the short sellers are basically giving the company an opportunity for easy money.

Also, why wouldn't you have to pay tax on gains from a short if the company goes bankrupt?