Purchase Stocks under SEC Regulation CF How do I deduce the loss of that investment?

[dcabrames]

5 years ago, I purchased stocks under the SEC Regulation CF (Crowd Funding) via the website StartEngine.  Those stocks have failed and so I am trying to work out how do I deduct the loss of my investment.  I never received any documentation from these failed investments other than a Certificate confirming my investment.

If someone could direct me to where I need to go please.

Thank you

David

[AmyC]

Full instructions for how to write off your loss can be found at Losses (Homes, Stocks, Other Property) 1 - IRS 

[dcabrames]

Dear Amy,

Thank you very much for your reply.  I read through the instructions for Form 8949 and I entered all of the information but I cannot figure out which column on form 8949 I need to enter the word "WORTHLESS" the instructions tell me to complete Part 2 (Long Term Capital Gains and Losses, Enter 12/31/2021 as the sale date and list each stock separately.  I did all that and then I am suppose to enter the word "WORTHLESS" into the "appropriate" column.  When I try that in TurboTax I get an error on the return check.  I tried Column 'd' as that seemed like the appropriate column.  Do you have any idea which column I use?

[AmyC · Accepted solution]

Anything that works- but I think this may well be one of those situations where you have the sale price as zero and the IRS will have to work with it. File it straight and simple to go through. Keep your records showing it was worthless stock in case of an audit. The IRS hates this schedule. Since you have easy proof, I would not worry about it at all.

@dcabrames

[dcabrames]

Dear Amy,

Again Thank you for your reply and assistance.  I guess I'll also take the Audit Defense option as well.

David