Question

I don't know what to do regarding my Limited Partnership Investment that has done nothing in 5 years

Forum|Forum|5 years ago
February 9, 2021
1 reply
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I invested in a Limited Partnership company startup about 5 years ago. I have received nothing from the company and it is not on the stock exchange. There are apparently 20000 shares created with the original option price per share of $0.01. The title of this certificate is "2015 Equity Ownership Plan Nonstatutory Stock Option Certificate". It is/was a startup medical device company in Massachusetts. I have occasionally received correspondence when I insist on it but at this time, it is doing nothing, more so due to Covid 19. Since it has been 5 years, am I entitled or able to file my 2020 tax return and recoup some of the investment as a loss?

TurboTax Home & Biz Windows

T

ToddL99

If the company ceased operations in 2020 because of Covid19, you can treat your investment as "worthless" in 2020 and claim a capital loss in the amount of your investment.

You appear to have concluded the investment became worthless in 2020 on account of Covid 19 issue (i.e. "but at this time, it is doing nothing, more so due to Covid 19.)"

The IRS allows you to deduct worthless stock only in the tax year it becomes completely worthless. This is to prevent investors from picking and choosing what year to claim losses on worthless investments.

How do I deduct worthless stock?