Shorthand way to report stock trade losses?


I have a nephew who has a small stock market account (in the U.S., through TD Ameritrade). He is a high school age minor, so it is a custodian account. He started out with about $7,000 in the account a few years ago, then bought and sold a bunch of penny stocks -- and he lost almost all of it. His mother is just getting around to getting her and my nephew's taxes done and filed for 2007 and 2008. The bookkeeper/accountant who is doing the taxes said that since my nephew had many transactions in the TD Ameritrade account (close to 100?), it will take a lot of time to sort them out and it could be an expensive process.
Since the overall net of all of the in and out trades in an almost total loss, is there any way to just do an estimate for IRS tax purposes and just show an estimated net loss rather than trying to re-create and sort out each and every transaction?
Reply to
Jay-T

Unless the child has plenty of other income the loss is gone forever. It can be reported on the brokerage 1099B with the supporting schedule of transaction from Ameritrade. Add date purchased, total all purchased prices and then make certain that total equals the the total of the 1099B for sale price. Attach the Ameritrade schedule and all information to the return and you're done.
Reply to
Tamiami

Yes, the loss is gone forever.
That seems like a fairly easy way to report the transactions for tax purposes. Thank you!
Reply to
JayTKR

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