Invested in WAMU, Lost Everything, Can I do a tax write off?

[manlymatt83]

Originally posted by: Kenji4861
Let's not get into why I invested in Wamu.. it just sounded like the $700B bail out was going to happen.. anyways.

So I lost about $2000 to WAMU.

I heard I can write up a loss for this investment. Say I haven't made any money on stocks this year. Can I write this $2000 off my regular income? or I can only deduct from income I made on stocks?

would have been better off investing in my friend's prosper listing 😛

 

[Ns1]

I bet $120 on black and lost.

 

[flashbacck]

Originally posted by: Eeezee

Originally posted by: DisgruntledVirus

Originally posted by: Ocguy31

Originally posted by: senseamp
You did not invest in WaMu, you gambled on WaMu.

😕 4% CDs arent for everyone you know.

Neither are $2000 gambles that a company in need of a bailout won't fail for everybody.

Seriously, this decision was no better than going to a roulette table.

Well, this of it this way, if no one made poor decisions in the market, then it wouldn't be possible to make good decisions either. So, we should all be grateful 😛

 

[TheSlamma]

Yes you can write it off as a loss.

 

[DayLaPaul]

It was 2g's. You guys are acting like he lost his house or something. That's like 2 hands of blackjack on a hot streak.

 

[spidey07]

Originally posted by: DayLaPaul
It was 2g's. You guys are acting like he lost his house or something. That's like 2 hands of blackjack on a hot streak.

Exactly. And it was a good bet too considering what happened to lehman.

Also, I didn't think you could have a net capital gains loss, short term in this case. Meaning you can offset your gains with loss but only down to zero. Not an expert though.

-edit-
google to the rescue
http://www.wwwebtax.com/deduct...her/capital_losses.htm

"You fully deduct capital losses against capital gains on Form 1040, Schedule D. If capital losses exceed capital gains you can deduct the excess on your tax return as follows. Your allowable capital loss tax deduction on your tax return for any tax year, figured on Form 1040, Schedule D, is limited to the lesser of:
$3,000 ($1,500 if you are married and file a separate tax return), or
Your capital loss as shown on Form 1040, line 18 of Schedule D.

If you have a capital loss on Form 1040, line 18 of Schedule D that is more than the yearly limit on capital loss tax deductions, you can carry over the unused part of the tax deductible capital loss to later tax years until it is completely used up. "

 

[Xavier434]

Originally posted by: DayLaPaul
It was 2g's. You guys are acting like he lost his house or something. That's like 2 hands of blackjack on a hot streak.

Ehh....I wouldn't exactly call it a hot streak. I also think the odds of winning on two hands of blackjack were probably a lot better than investing WAMU. I understand your point and all, but surely you see mine too. It is all about making good decisions regarding potential risk and potential gain.

 

[DayLaPaul]

Oh I most definitely see your point. I've never bet $1000 a hand on blackjack, but I know a lot of people who have. I'm more of a poker man myself, which is less risk/less reward, which is more like the investment you described.

 

[OdiN]

Look at the bright side.

At least it was only $2,000 and not $20,000.

 

[JimRaynor]

so if you can just write it off why wouldn't everyone invest at least 3000 per year cause if they lose it they can just write it off. am i missing something?

 

[spidey07]

Originally posted by: JimRaynor
so if you can just write it off why wouldn't everyone invest at least 3000 per year cause if they lose it they can just write it off. am i missing something?

By "writing it off" you are deducting it from your taxable income. You don't magically get your 3000 dollars back, it's still a loss.

 

[ed21x]

Originally posted by: JimRaynor
so if you can just write it off why wouldn't everyone invest at least 3000 per year cause if they lose it they can just write it off. am i missing something?

because it get deducted from your income, so you pay your taxes (say 25%) on a smaller income. Not $2000 less taxes. Realistically, this will decrease your taxes by a few hundred dollars, but then again, you have to lose $2000 to get this tax decrease, so never come out ahead.

 

[JimRaynor]

ah ok i get it