Robert,
I did the steps you described and the NOL from 2018 shows up on 2019 schedule 1 line 8 (other income) . The carryforward from 2018 is combined with (25000) of Rental Real Estate losses and carries over to line 7a. This loss subtracted from all on 1040 resulting in a (63506) AGI. From this I subtract 27000 of standard deduction and have 0 taxable income.
First a silly question, in this case, just because the all losses show up on the tax return it does not mean they are used up right?
2nd because there are losses and they are from 2017 (yes I filed election to forego the Carryback), I now fill in Worksheet 2, WRKST to figure how much of the NOL to carryover from 2019 to 2020 (For NOL carryforward from a year before 2018). I have a question on this worksheet.
Line 1 Enter as a pos. # your NOL deduction for the NOl year entered above from Sched 1: I entered (89642) which showed on 2019 Sched 1 line 8, other income
Line 2 Enter your taxable income without the NOL deduction for 2019.
(Instructions:Enter your taxable income without the NOL deduction for the year listed at the top of Worksheet 2, but with the NOL deduction from any prior year.)
The NOL deduction for 2019 is (864)
I entered my AGI (63506) which is all my non business income $[social security number removed](cap gain losses)-25000 (real estate bus losses) -89642 (NOL from 2017)=(63506) MY AGI on 1040 line 8b. Is this correct, do I subtract the Standard deduction too?
Line 3 net capital loss deduction: 3000
Line 4,5,6 are 0
Line 7 Enter any adjustments to your AGI. See Instructions.
You must refigure the following income and deductions based on AGI.- Why does it say REFIGURE?
- The special allowance for passive activity losses from rental real estate activities. This is the only one I have 25,000 . But it stays the same based on AGI. do I enter 25,000 on line 7 or 0 because it stays the same.
- Taxable social security and tier 1 railroad retirement benefits.
- IRA deductions.
- Excludable savings bond interest.
- Excludable employer-provided adoption benefits.
- The student loan interest deduction.
I really appreciate it if you can tell me if I am interpreting Worksheet 2 correct or not?
