[spookthesunset]

Tax deductions aren’t tax credits. Investment losses are deductions not credits. It is a huge difference.

“Writing off” a investment loss only reduced your bill by the marginal tax rate of your loss. If it was a credit, you’d be marking down the tax bill by the entire amount of the loss, which isn’t what happens for investments.

To many people think that something being deductible makes it “free”. No. They basically give you a discount for the item equal to your marginal tax rate.

Note: I am not a CPA. Please see one before doing your tax if you are confusing credits and deductions.

[myrandomcomment]

My quote was from a document prepared by a CPA. I agree with what you said - you need to check, but in most cases, someone in the Bay Area making the typical pay can write off a loss from a startup over a period of a few year. Your milage might vary.