Basically what you’re saying as per the example that the market loss is capital gains (loss) and currency change is ordinary gain (loss).
In my example, it’s a CD. Hence, where there’s income (interest paid) as ordinary income which I have reported annually and paid taxes. And now I have currency loss, which should be ordinary loss as well. Example: $1000 invested in CD in foreign currency. Say $50 equivalent interest earned in year 1. Total value after growth in USD equivalent (held in foreign currency) = $1050. When I close the CD, I got back only $950 due to currency loss. So $100 should be deductible on schedule 1 - line 8z as a negative number -$100. Correct?
