Lost earnest money/deposit on a house that I intend to use as the rental property--Where to Enter in Turbo tax as Capital loss?

[Shak187]

Due to some financial risk, I backed off and lost the deposit for a house that I was going to buy in another state as the investment and rental property.

Trying to find how to enter this Capital loss in 2023 Turbo tax (Premier).

I tried to enter in " investment sales ", but the very first question it asks is "What type of investment did you sell?,

and then "How and when did you receive this investment?

In my case I did not sell, instead, lost the deposit so what should I write?

Or would there be some other place to enter the loss of deposit as the Capital loss?

[Mike9241]

tell a fib to turbotax say yes to selling  stocks whatever. 

If you lost earnest money due to a failed business purchase of a rental home, you may claim the loss. The loss would be considered a capital loss you would write off on your Schedule D. 

In the program, go to: 

1. Federal
2. Investments 
3. Stocks, Mutual Funds, Cryptocurrency, Collectibles, etc. 
4.  description forfeited escrow deposit to buy rental property

• For 'Date Acquired', enter the date the money was placed in escrow.
• For 'Date Sold', select the Alternate Option and choose "Worthless".
• You will choose "Worthless Short Term" if the money was in escrow for less than 1 year.
• You will choose "Worthless Long Term" if the money was in escrow for 1 year or more.
• The cost would be the amount of earnest money you put down on the property.
• The sales price would be $0.
• You did not receive a 1099-B will be the cost basis 

[Shak187]

Thanks Mike,

I tried to follow the steps could follow few but then could not proceed.

What type of investment did you sell      "Other"

How did you receive this investment       "Something else"

Description                            "forfeited escrow deposit to buy rental property"           

When did you receive this investment     "I put the date when I sent the money"

Date Sold or disposed --> Here the TT does not give me the option of selecting "Alternate Option". This field just shows the date format. 

Proceeds                           It does not give any option to chose from but "I can put the total amount that I sent.

Cost or basis                        This box/field also expecting $amount, but I can try to write as you described.

Basically, this this TT tool that I have is "Premier" and it does not give the options to pick from as you described below, instead I see the fields as mentioned above.

• For 'Date Sold', select the Alternate Option and choose "Worthless".
• You will choose "Worthless Short Term" if the money was in escrow for less than 1 year.
• You will choose "Worthless Long Term" if the money was in escrow for 1 year or more.
• The cost would be the amount of earnest money you put down on the property.
• The sales price would be $0.