Submitted By: someone
Answered: January 9, 2023 1:33 am

I had put money into FTX cryptocurrency, which is now in bankruptcy. How do I report the loss on my tax return?

As of yet, it is not clear how to report the loss. FTX has filed for Chapter 112 bankruptcy protection, which means that holdings may still have some value. The IRS may clarify whether those who put money into FTX are victims of a Ponzi scheme and would be eligible for immediate tax write-offs. Stay tuned…we’ll provide guidance as soon as this matter is clarified.

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Tax Glossary

Section 1231 property

Depreciable property used in a trade or business and held for more than a year. All Section 1231 gains and losses are netted; a net gain is treated as capital gain, a net loss as an ordinary loss.

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