Thanks for following up. You can report this as a capital loss
on your tax return. You had a return of $8,000 of your original investment of $10,000. Thus, you had a $2,000 loss which you would report on your return.
Pursuant to IRS
Tax Topic 409 (http://www.irs.gov/taxtopics/tc409.html)
"If your capital losses exceed your capital gains
, the amount of the excess loss that can be claimed is the lesser of $3,000, ($1,500 if you are married filing separately
) or your total net loss as shown on line 16 of the Form 1040
, Schedule D
(PDF). If your net capital loss is more than this limit, you can carry the loss forward to later years."
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