To claim a loss for a stock that went bankrupt in December 2023, even if it doesn't appear on your 1099 forms, you can follow these steps:
- Open or continue your return. Please be sure you are signed in for step 2 link to work.
- Navigate to the investment sales section:
- TurboTax Online/Mobile: Go to investment sales.
- TurboTax Desktop: Search for investment sales and then select the Jump to link.
- Answer Yes to the question Did you have investment income in 2024?
- If you land on the Your investments and savings screen, select Add investments.
- Enter your investment manually, select Enter a different way, then select your investment type (stock) on the next screen.
- Enter the information requested using your statements and purchase information
- The sales prices would be 0 if you received nothing from the sale of worthless stock
- Sales date is likely December 31 - IRS rule for worthless securities
- Follow the instructions and TurboTax calculates the loss from the sale of bankrupt stock.
You can deduct a net loss of up to $3,000 ($1,500 if Married Filing Separately). Any capital loss you couldn't deduct this year can be carried forward and deducted on future tax returns as a capital loss carryover.
