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Any of the TurboTax experts know how to claim a capital loss from a venture-related investment in a PRIVATE business that is in Chapter 7 bankruptcy?
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Since the loss was on preferred stock for a private company with no 1099-B issued, I created a 1099-B entry with "no brokerage statement" for the sales, the choice "not reported to IRS", entered the cost basis(my investment), final value ($0) as the proceeds, and the date of bankruptcy filing as the sales date. I also selected "long-term" as the box F holding period. I filled in no other fields nor selected any boxes for the following screens.
Federal return was accepted.
Note that I do NOT have, nor will I have a 1099-B from this private company.
All I have is the recent bankruptcy filing and my original stock shares statement.
You can deduct worthless stock or a worthless investment only in the tax year it becomes completely worthless. This normally happens when the corporation files for bankruptcy, stops doing business, and has no assets.
This is entered in the investment section of TurboTax. Capital gains, losses, and 1099-B forms are all entered in the same place:
Related Information:
Since the loss was on preferred stock for a private company with no 1099-B issued, I created a 1099-B entry with "no brokerage statement" for the sales, the choice "not reported to IRS", entered the cost basis(my investment), final value ($0) as the proceeds, and the date of bankruptcy filing as the sales date. I also selected "long-term" as the box F holding period. I filled in no other fields nor selected any boxes for the following screens.
Federal return was accepted.
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