How to claim unreported capital losses from previous years on current tax return?

15 Wait, so I have to file returns for those years even if I had no income? I thought you only needed to file if you made over a certain amount. Will I get penalized for filing these past returns so late?

8 You're right that there are income thresholds that determine if you're required to file. If you were under those thresholds, you weren't legally required to file - but in this case, filing is still necessary to document and establish your capital losses so you can carry them forward. You generally won't face penalties for filing late returns that don't show a tax due. The IRS is primarily concerned with collecting taxes owed, so if these returns don't show any tax liability (and especially if they show losses), penalties are unlikely. The bigger issue is that without filing those returns, you simply can't claim the benefit of carrying those losses forward to current and future years.

18 How does this service handle different types of investments? I've got some stock losses but also lost money on some options contracts. Does the system understand the different treatment of those?

22 I'm a little skeptical about uploading financial statements to any online service. How secure is this? And does it actually prepare the amended returns or just tell you what to put on them?

12 It handles different investment types really well. The system recognized my stock trades, crypto sales, and even some more complex investments. For options contracts, it properly calculates the loss based on the contract specifications and applies the correct tax treatment. The security is actually what convinced me to use it - they use bank-level encryption and don't store your documents after processing. It doesn't file the returns for you, but it generates detailed reports showing exactly what forms you need and what numbers go where. I just took that info and used it with my regular tax software to file the amended returns.

17 How exactly does this work? Does it just dial the number for you or what? I don't get how any service could get you through the IRS phone system faster than calling directly.

22 Yeah right. Sounds like snake oil to me. The IRS phone system is designed to be impenetrable - no service could possibly get you through faster. I've tried calling dozens of times about my amended return and it's always the same "due to high call volume" message before disconnecting.

5 It's not just dialing for you - the system actually interfaces with the IRS phone system on your behalf, navigating through all the prompts and waiting in the queue instead of you. When an actual IRS agent becomes available, Claimyr calls you and connects you directly to that agent. The reason it works is because their system can handle staying on hold for hours while you go about your day. They've basically reverse-engineered the IRS phone system to understand the best times to call and which prompts will get you to the right department. It's not magic - just efficient technology handling the most tedious part of contacting the IRS.

15 What kind of documentation should I save exactly? I have confirmation emails when I made the trades, plus year-end statements from my brokerage. Is that enough or do I need something else?

7 The year-end statements from your brokerage are a good start, but also keep the individual trade confirmations if possible. If your brokerage provides a gain/loss report for the tax year, definitely save that as well. It's also helpful to keep a simple spreadsheet tracking each position, when you bought it, how much you paid (including any fees), when you sold it, and the sale price. This makes it much easier to verify the numbers on your tax forms and spot any discrepancies. In my case, having this detailed information available immediately when the IRS asked questions made the process go much smoother and faster.

3 I did my amended 2020 and 2021 returns last year using TurboTax. You definitely have to mail paper forms for 2020 (Form 1040-X), but for 2021 and newer you can e-file amendments through TurboTax. Just make sure you have all your original filing information handy because you'll need to enter both the original amounts and the corrected amounts.

This is really helpful advice about organizing everything chronologically! I'm just starting to tackle my own unreported losses from 2021-2022 and feeling pretty overwhelmed by all the trades I need to sort through. The wash sale point is especially concerning - I definitely made some trades where I might have bought back similar positions without thinking about the 30-day rule. Quick question about the worthless securities - how do you prove to the IRS that a stock actually became worthless in a specific year? I had a couple of small companies that basically disappeared, but I'm not sure how to document that they were truly worthless on December 31st of the tax year versus just having very low value. Do you need some kind of official bankruptcy filing or delisting notice? Also, did you use any specific software or just spreadsheets to organize everything? With hundreds of trades across multiple accounts, I'm wondering if there's a better way than manually entering everything.

For worthless securities, you'll need to document that the company actually became worthless during the tax year, not just that the stock price dropped to near zero. The best documentation is an official bankruptcy filing, delisting notice from the exchange, or a formal announcement that the company has ceased operations. You can usually find this information on the SEC's EDGAR database or the company's final press releases. If you can't find official documentation, you can sometimes use the fact that trading stopped permanently and the company stopped filing required SEC reports as evidence. Just make sure you can show the worthlessness occurred in the specific tax year you're claiming. For organizing hundreds of trades, I'd highly recommend using your brokerage's year-end tax documents first - most provide detailed gain/loss reports that are already organized and include wash sale adjustments. If you need to go beyond that, there are some good tax software tools that can import trading data directly from major brokerages, which beats manual entry by a huge margin. TurboTax Premier and similar programs can often pull the data automatically if you still have account access.

For worthless securities, you'll want to gather any documentation you can find showing the company ceased operations or was delisted. SEC filings, bankruptcy court documents, or official exchange delisting notices are ideal. Sometimes even news articles about the company shutting down can serve as supporting documentation. The key is showing the security had no reasonable expectation of recovery as of December 31st of the tax year. For organizing trades, I actually started with spreadsheets but quickly switched to importing my 1099-B data into TurboTax's import feature - it handles most of the heavy lifting and automatically flags potential wash sales. If you have really complex situations, some people swear by TradeLog or similar specialized software that can handle hundreds of trades and complex wash sale calculations. The wash sale issue is tricky - the 30-day rule applies both before AND after the sale date, so you need to check 61 days total around each loss transaction. Don't panic though - even if you have wash sales, you don't lose the loss permanently, it just gets added to the cost basis of the replacement shares and defers when you can claim it.

For worthless securities, you'll need some form of documentation showing the company became worthless in that specific tax year. This could be bankruptcy filings, SEC delisting notices, or even news articles about the company ceasing operations. The IRS Publication 550 has specific guidance on this - basically you need to show the security became "completely worthless" with no reasonable expectation of recovery. For organizing trades, I found that most major brokerages (Fidelity, Schwab, etc.) offer downloadable transaction histories in CSV format that you can import into Excel or Google Sheets. This saves tons of manual entry time. For wash sale detection, I actually ended up using a tool called GainsKeeper (now part of Schwab) for one account, but you can also create formulas in Excel to flag potential wash sales by looking for purchases of the same ticker within 30 days before or after each sale. If you're dealing with hundreds of trades, definitely consider using tax software like TurboTax Premier or TaxAct that can import transaction files directly from most brokerages. It's worth the cost to avoid manual entry errors that could cause problems later.

For worthless securities, you'll need to document that the company ceased business operations or went through bankruptcy/liquidation during that tax year. The best evidence includes SEC filings showing delisting notices, bankruptcy court documents, or official company announcements of cessation of business. You can usually find this information on the SEC's EDGAR database by searching the company name. If the stock was delisted but the company still exists (even if not trading), it might not qualify as "worthless" for tax purposes - it has to be completely without value. I had to do some digging through old press releases and SEC filings for my penny stocks, but it was worth it for the additional losses. For organizing trades, I actually started with spreadsheets but ended up using a combination of my brokerage's year-end tax documents and some free portfolio tracking tools online. Many brokerages provide gain/loss summaries that already calculate wash sales, which saved me tons of time versus trying to identify them manually. If you have hundreds of trades, definitely start with whatever consolidated tax reports your brokers provide - it'll give you a foundation to work from rather than starting completely from scratch.

For worthless securities, you typically need documentation showing the company ceased operations, filed for bankruptcy, or was delisted with no prospect of recovery. SEC filings, bankruptcy court documents, or official exchange delisting notices work well. If it's a small company that just disappeared, sometimes news articles or press releases announcing closure are sufficient. The key is showing it became worthless in that specific tax year, not just declined in value. For organizing trades, I'd strongly recommend against manual entry if you have hundreds of transactions. Most brokerages provide downloadable CSV files of your trading history that you can import into Excel or Google Sheets. From there, you can sort by date and use formulas to calculate gains/losses automatically. For wash sales, there are online calculators that can help identify potential issues, or you might want to consider using tax software that handles wash sale adjustments automatically. If you're dealing with multiple accounts and complex trading patterns, it might be worth the cost to use a service like the taxr.ai mentioned earlier in this thread, especially since wash sale mistakes can be costly if the IRS catches them later during an audit.

For worthless securities, you'll need documentation showing the company ceased operations or was delisted. SEC filings showing bankruptcy, delisting notices from exchanges, or news articles about company closure work well. The IRS wants proof the security had no reasonable expectation of recovery as of December 31st. For organizing trades, I'd recommend checking if your brokerages offer downloadable transaction histories in CSV format - most do. You can import these into Excel or Google Sheets and use formulas to identify potential wash sales automatically. Look for purchases of the same ticker symbol within 30 days before or after each sale. If you have hundreds of trades, consider tax software like TaxAct or FreeTaxUSA that can import brokerage files directly and flag wash sales. Some people also use portfolio tracking tools like Personal Capital (now Empower) which can connect to multiple accounts and generate comprehensive transaction reports. Much easier than manual entry, especially when you're dealing with multiple years and brokerages.

For proving worthless securities, you'll need documentation showing the company ceased operations or became insolvent. SEC filings showing bankruptcy, delisting notices from exchanges, or news articles about company closure work well. The IRS Publication 550 has specific guidance on this - basically you need to show the security had no reasonable prospect of recovery. If you can't definitively prove worthlessness in a specific year, it's safer to just claim them as capital losses when you actually sold them (even for $0). For organizing trades, I'd strongly recommend starting with your brokerage's year-end tax documents rather than manual entry. Most brokerages provide detailed gain/loss reports that break down each transaction with wash sale adjustments already calculated. If you have hundreds of trades, consider using tax software like TurboTax Premier or TaxAct that can import directly from major brokerages. For wash sales, focus on reviewing any positions where you bought back the same stock within 30 days - the brokerage reports usually flag these, but double-check if you traded the same securities across multiple accounts since they might not catch cross-account wash sales.

For worthless securities, you'll need to document that the company was truly worthless at year-end. The best evidence includes: bankruptcy court filings showing liquidation completed, SEC delisting notices, or broker statements showing the position as "worthless" or valued at $0.00. If the company just stopped trading but wasn't officially liquidated, it's trickier to claim worthless status. For organizing trades, I highly recommend using specialized software rather than manual spreadsheets when you have hundreds of transactions. Tools like TradeLog or even TurboTax's import features can pull data directly from most major brokerages. Some CPAs also use professional software that can handle complex wash sale calculations automatically - might be worth consulting one if your situation is really complicated. The wash sale issue is definitely something to be careful about. The software I mentioned usually flags potential wash sales, but you'll want to review them manually since the "substantially identical" rule can be subjective. Better to be conservative and disallow questionable losses than risk problems later with the IRS.

For proving worthless securities, the IRS typically wants documentation showing the company ceased operations or had no reasonable prospect of recovery. Bankruptcy court filings are ideal, but you can also use SEC delisting notices, news articles about company closure, or even screenshots from your brokerage showing $0.00 value. I kept PDF copies of relevant news articles and the final trading day from Yahoo Finance showing "no longer trading" status. Regarding organization, I started with spreadsheets but quickly switched to a combination of tools. Most brokerages will export your transaction history to CSV files which you can then import into Excel or Google Sheets. For wash sale detection, I found that TurboTax's import feature actually caught most of them automatically when I uploaded my 1099-B forms, but you can also use free tools like PortfolioVisualizer to check for wash sales if you're doing it manually. The key is getting all your data in one place first - don't try to do the tax analysis while you're still gathering records. Get everything downloaded and organized, then worry about the tax implications. It's much less overwhelming when you tackle it step by step.