Key insights
- A user reports that E*Trade did not include worthless stock disposals on their 1099 form. While the user was able to claim the loss, this could be a potential issue for other investors using E*Trade or other brokerage platforms. This may lead to investors missing out on potential tax benefits, resulting in a slightly negative impact.
I disposed off worthless stocks by calling Etrade last year. However, it was not included in 1099. I happened to find this out just before submitting my taxes. I just want to aware others who might also not have known this. It very well be a standard practice across different platforms or a standard tax rule. However, I had no idea till I called Etrade. They informed me that we can claim it ourselves in the tax filing without needing an updated 1099.
For me, it made a difference of $4,548 as I had disposed stocks worth of $13,884. This included the tax penalty that I don’t have to pay anymore.
I hope this helps.