TT H&B 2020. Bottom of the business section overview: Less Common Business Situations/Net Operating Loss; its looking for any 2019 NOL carryover. I guess I don't know what this refers to. I have a rental property dealing with carryover losses via Schedule E. Is this different than that? If so, why doesn't it say so? Of not, why doesn't it say so?
I also have a sole proprietor business that did not show a loss.
Is this asking about A) all business loss carryovers including Schedule E carryovers, which are already reported, B) all business loss carryovers excluding Schedule E carryovers, or C) any "top-level" *individual* (in this case married-filing-jointly) NOL carryovers? And if C), why is it in the business section?
It is highly unlikely that you have an NOL for the current tax year.
The section to which you referred applies to an NOL carryover from 2019 and it is also highly unlikely that you would have an NOL from 2019 unless your business sustained a net loss and/or you disposed of your rental property.
Okay, thanks. Good to know.
So it sounds like net loss on a rental property is not considered an NOL? So what is?
Is it a business thing (like for my sole proprietorship)? An overall individual thing (my wife's and my MFJ return in this case)? What are they looking for here?
Yes, the source is primarily a "business thing" (net loss from a trade or business).
Also, the sale of business property (including rental real estate) could have the same effect.
Having a loss on a Sch E is not called an NOL ... it is a Passive Loss and it is carried forward on the form 8582.
If you have a negative AGI on the form 1040 then you "may" have an NOL.