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<< My situation is that I traded many stocks during this year, and my account is actually a big loss. i.e. I am not holding those positions. According to what you pointed out: "I have to report those lose on my tax return, and my loss is deductible".

I don't understand what that means to me. Since I lost a big money, even I report my lose which is deductible in my tax return, it still doesn't cover all of my lose. (I invested $60K and lost $40k, which is even more than my current annual salary). So, how should I deal with such a bad situation? >>

I'm beginning to suspect that you should hire someone to do your 1999 return, although that will put you further in the hole. But there are basic tax rules you don't seem to be aware of.

1. Each of your 1999 sales is a reportable transaction on Schedule D.

2. If you were trading in and out of one stock and still maintain a position in it (or plan to acquire one soon), you have to be careful of the wash sale rules on your losses.

3. It looks like the bottom line of your Schedule D will be a sizeable loss. You can only claim $3,000 of that on your 1999 return. The balance is carried forward to 2000.

Phil Marti
Tax Preparer
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