I invested $10k in a company in 2018. The 2018 K-1 reported short-term capitals gains of $23k which I paid taxes on with my 2018 return. In late 2019 it was discovered that this company I invested in was a scam and that the profits reported on the 2018 K-1 were made up. There were federal indictments and two of the partners are in jail now. What do I need to do in order to get a refund for the taxes I paid on the fake gains of $23k? Do I amend 2018? If so, how do I indicate the K-1 was not correct since I would assume the IRS will match my K-1 to my tax return and think I owe the taxes?
I was not issued a K-1 for 2019 and am under the impression I never will be. Do I need to do anything on my 2019 return or should I just omit anything related to this K-1?
Any help would be much appreciated!!
