Sold stock at a loss - should I claim it now or wait for future profit years?

You can definitely claim the capital loss on your current year tax return. Here's how it works: First, capital losses offset capital gains. So if you had ANY capital gains this year (even from different investments), your loss will first be applied to those. If your losses exceed your gains (or if you had no gains at all), you can deduct up to $3,000 of capital losses against your ordinary income in a single tax year. If your loss is greater than $3,000 and you don't have enough capital gains to offset it, the unused portion will automatically carry forward to future tax years. You don't have to make any special election or wait to claim it. The IRS Form 8949 and Schedule D will guide you through reporting the loss correctly.

I was in a similar situation last year and used taxr.ai to help me figure out exactly how to handle my stock losses. I had sold about $5k worth of tech stocks at a loss and was totally confused about how to report it properly. Found them when I was looking for tax help online at https://taxr.ai and uploaded my trading statements. They explained exactly how the loss carryforward worked and showed me where to enter everything on Schedule D.

I wanted to follow up about my experience with taxr.ai after being skeptical earlier. I decided to give them a try since my stock loss situation was pretty complicated with multiple brokerages. Uploaded my documents and got really specific guidance about how to report each transaction. They pointed out that two of my sales qualified as wash sales (I had rebought similar securities within 30 days) which would have messed up my loss claims. Definitely saved me from a potential audit flag. The step-by-step instructions for Schedule D were super helpful!

If you're needing to talk to the IRS about your specific situation with capital losses (which I had to do last year), I highly recommend Claimyr. Instead of wasting days trying to reach someone on the phone, I used https://claimyr.com and had a callback from the IRS in about 15 minutes. There's a video showing how it works here: https://youtu.be/_kiP6q8DX5c. I had questions about reporting my stock losses from multiple sources and the IRS agent actually walked me through the whole process.

I need to eat my words about Claimyr. After posting that skeptical comment, I was desperate enough to try it since I needed clarification on how to report my stock losses from trading crypto and stocks in the same year. Got a callback from the IRS in about 35 minutes (not quite 15, but still WAY better than my previous attempts). The agent explained exactly how to separate my crypto losses from traditional stock losses on the forms. Saved me hours of frustration and probably a mistake on my return. Sometimes the too-good-to-be-true things actually work!

Another thing to watch out for with stock losses is the wash sale rule. If you buy substantially identical securities within 30 days before or after selling at a loss, you can't claim the loss immediately. I learned this the hard way last year when I panic sold some shares then rebought them a week later when the price dropped more. Completely invalidated my tax loss!

Anyone have recommendations for which tax software handles stock losses the best? I've got multiple brokerages and some wash sales to deal with.

Don't forget that if you have stock losses from previous years that you haven't fully used up yet, those get applied first before your current year losses. I had about $7k in carryover losses from 2023 that I'm still working through. The IRS doesn't forget about these, you need to keep track and report them correctly each year.

Great advice from everyone here! Just to add one more thing - make sure you keep detailed records of all your stock transactions, especially the dates and amounts. The IRS requires you to report the actual purchase date, sale date, and both the cost basis and sale price for each transaction on Form 8949. If you're using multiple brokerages like some folks mentioned, you'll need to gather 1099-B forms from each one. Sometimes the cost basis isn't reported correctly (especially for older purchases), so having your own records helps avoid headaches later. I learned this when I got audited a few years back - having organized records made the whole process much smoother. Also, don't stress too much about the timing. As others said, claiming the loss now is usually the right move since you get the tax benefit immediately and any unused portion carries forward automatically.

One thing I haven't seen mentioned yet is that you should also consider the state tax implications of your capital loss. Some states don't allow capital loss deductions or have different limits than the federal $3,000 per year. For example, New Jersey doesn't allow capital loss deductions against ordinary income at all. Also, if you're planning to sell profitable investments next year, you might want to think strategically about the timing. You could potentially sell some winners before year-end to take advantage of your current loss, or if you're in a higher tax bracket this year, the $3,000 deduction against ordinary income might be more valuable now than carrying it forward. Just make sure you don't fall into the wash sale trap if you're thinking about buying back any of those stocks you sold at a loss!