advice
You do not need to pay taxes on a capital loss from stocks that is less than $5, such as your loss of $2.50. Here’s how it works:
Realized Loss Requirement: To claim a capital loss, you must have sold the stock. Since you lost money on your investment and withdrew from the account, you likely have a realized loss that can be reported13.
Offsetting Gains: Capital losses can offset any capital gains you have for the year. If you don’t have any gains, you can still deduct up to $3,000 of your net capital losses against other types of income (like wages) for the tax year. However, since your loss is only $2.50, it will not affect your taxes significantly, as it is well below this limit14.
Filing Requirements: You should report your capital loss on Schedule D of your tax return. Even small losses can be included, but they will not have a substantial impact on your overall tax liability due to their minimal amount35.
In summary, while you can report the loss, it is unlikely to affect your taxes significantly due to its small size. If you have further questions or complex situations, consulting a tax professional might be beneficial.