Did you materially participate in that activity this year?
If you materially participate in an activity you may be able to classify the activity as nonpassive and thus use any losses from that activity to offset other sources of taxable income.
Generally, losses from passive activities can only offset passive income (which, strange though it may seem, does not include income from an investment portfolio). As with all tax things, there are exceptions to these guidelines and these determinations are made annually based on facts and cirumstances: please consult a tax advisor about your individual situation to determine the correct tax treatment.
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