# How to properly report a defaulted bond on my US tax return



## MangoTango (Feb 8, 2020)

For 10 years I owned $10,000 worth of bonds in a large(ish) US company. It only ever issued one bond and when it came time to redeem the bonds the company defaulted. My brokerage kept it on my account for a long time in the event of a 'possible escrow settlement' or something. In December of 2021 they finally 'liquidated' the holding (guess they got tired of keeping track of it). On this years 1099-DIV they report $795 as "Cash Liquidation Distribution" for the defaulted bond (and no mention at all of the last two interest payments they never distributed). There is no mention of the long term loss elsewhere on the 1099 Composite report. 

Do I need to fabricate a loss on a Schedule D myself ? Am I just plain out-of-luck and don't get a long term loss ?


----------

