I have $60k of worthless stock from a small business investment I am writing off. I enter it Federal Return and it treates it properly, taking it against ordinary income.
In my state CA taxes, this $60k is adjusted out completely, presumably because CA treates this loss differently, but it doesn't appear anywhere else in my taxes. CA does allow me to write off worthless stock, but the program doesn't move it anywhere, it just eliminates it.
It does this whether I select sec. 1242 loss or 1244, though it does change how things are calculated based on the $50k cap for adjustment to ordinary income with 1244 stock
