I am assuming that you have a net loss on your 1040. The IRS limits how much of a loss can be taken on an individual 1040 capital loss. You can deduct up to $3,000 in capital losses ($1,500 if you're married filing separately). Losses beyond that amount can be deducted on future returns as a capital loss carryover until the loss is all used up. Unless you have current year capital gains in which case the carryover losses on your investments are first used to offset the current year capital gains if any.
What is a Capital loss?
