topic I invested $6,500 in 2015 in a start up and the business failed how do I deduct my loss in Business & farm

I invested $6,500 in 2015 in a start up and the business failed how do I deduct my loss

Jay440 — Tue, 04 Jun 2019 22:31:38 GMT

Yes, you report this on your personal tax return. You wil...

DDollar — Tue, 04 Jun 2019 22:31:39 GMT

Yes, you report this on your personal tax return. You will enter this under the Investment Income area of Wages & Income.

Choose Personal >> Wages and Income, then I’ll Choose What I Work On.
Investment Income >> Stocks, Mutual Funds >> Start/Update.
Type of Investment: Everything Else
Enter a description, Net Proceeds = $0 and date of sale = dissolution date.
Acquired: Other method
Cost Basis: your investment basis at dissolution
Date of Acquisition: date you made your investment

TurboTax will calculate the loss on this investment and determine if it was short- or long-term. If you have other capital gains, the loss will offset some or all of the gains. Otherwise, up to $3,000 of the capital loss will go to line 13 of Form 1040 and offset other income. The remaining loss over $3,000 will be carried forward each year until used up (applied to capital gains and/or ordinary income).

Re: Yes, you report this on your personal tax return. You wil...

reg-20-flamespla — Sun, 28 Jun 2020 18:58:52 GMT

If you're in the first $1M of funding you can take a direct deduction, how does TT handle that?

https://www.forbes.com/sites/mariannehudson/2014/11/17/tax-[product key removed]-investor-should-know/#227a8a20d069

"This is the most important tip for most angel investors because IRC Section 1244 gives investors the ability to take an ordinary income deduction on losses rather than the standard capital loss deductions. There are caveats such as needing to be part of the first $1 million of capital raised by the company and a few other requirements."

Re: Yes, you report this on your personal tax return. You wil...

reg-20-flamespla — Sun, 28 Jun 2020 19:46:50 GMT

Not sure what happened with that link but

https://www.forbes.com/sites/mariannehudson/2014/11/17/tax-[product key removed]-investor-should-know/#f670dafd0694

Re: Yes, you report this on your personal tax return. You wil...

reg-20-flamespla — Sun, 28 Jun 2020 19:48:03 GMT

Hmm the forum is scrubbing the URL for some reason, here's a link....

Re: Yes, you report this on your personal tax return. You wil...

reg-20-flamespla — Sun, 28 Jun 2020 19:48:45 GMT

well this is fun, just remove the spaces in this

https://www.forbes.com/sites/mariannehudson/2014/11/17/ tax-[product key removed]-investor-should-know/#f670dafd0694

Re: Yes, you report this on your personal tax return. You wil...

reg-20-flamespla — Sun, 28 Jun 2020 19:49:15 GMT

https://www.forbes.com/sites/mariannehudson/2014/11/17/ tax- tips- every- angel- investor- should- know/#f670dafd0694