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Level 3

I lost over $10,000 dollars last year and yet I owe money in taxes?

Turbotax showed that I owed Federal Taxes even though I am in the negative over $10,000 in losses from trading stocks. It is the same amount I owe ($266) as before I entered that I lost the $10,000. Any way I can change this please? 

Thanks!

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Accepted Solutions
Level 9

I lost over $10,000 dollars last year and yet I owe money in taxes?

From you post it appears you have about 1800 of SE income.

If you are Self Employed, you can't avoid the SE tax.

Also pay attention to your stock loss carryforward, since only $3,000 can be deducted each year.

2 Replies
Level 9

I lost over $10,000 dollars last year and yet I owe money in taxes?

From you post it appears you have about 1800 of SE income.

If you are Self Employed, you can't avoid the SE tax.

Also pay attention to your stock loss carryforward, since only $3,000 can be deducted each year.

Level 9

I lost over $10,000 dollars last year and yet I owe money in taxes?

If you have investment sale losses, after you subtract the losses from your gains you can only deduct up to 3,000 per year. You can only deduct up to 3,000 (1,500 MFS) loss per year after any gains you have.  So if you have a lot of current gains you can use up the loss.  The rest you will have to carryover until it is used up.

And even though you can reduce your taxable income down to zero for the regular income tax you might still owe self employment tax or the 10% early withdrawal penalty on 401k or IRA withdrawals or some other kind of tax.