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Is the 3000 deduction for a stock loss worth the extra paperwork with 85k salary?

Forum|Forum|6 years ago
May 31, 2019
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Best answer by Hal_Al

Yes. It's a savings of $3000 times your marginal tax rate (25% {single} in your income range). 3000 x 0.25 = $750.

If you are showing a net $3000 loss, you probably have an additional carry over to next year, which could result in another 25%.

The extra paper work is minuscule compared to the hassle the IRS will put you through if those transactions don't show up on your tax forms.

Hal_AlAnswer

Yes. It's a savings of $3000 times your marginal tax rate (25% {single} in your income range). 3000 x 0.25 = $750.

If you are showing a net $3000 loss, you probably have an additional carry over to next year, which could result in another 25%.

The extra paper work is minuscule compared to the hassle the IRS will put you through if those transactions don't show up on your tax forms.

VolvoGirl

What is the loss from? I mean did you have sales? You don't report losses until you sell it. If you sell something you should get a 1099B for it. If you don't report it the IRS might think the whole sale amount is gain and taxable and might not know your cost basis.

fanfare

Most people insist on every deduction available to them. You may be the exception that proves the rule.

SteamTrain

...but if you sold any stock, bond, mutual fund at all during 2016....the IRS expects you to record that transaction on your 2016 tax return..no matter whether it was a gain or a loss.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*