Get your taxes done using TurboTax
The amount from the total on Worksheet 6 carries over to the ordinary income Box 1 and 2a on form 8582.
Here is a link to instructions for Form 8582, Passive Activity Loss Limitations.
Worksheet 6
Use Worksheet 6 for any activity listed in Worksheet 5 if all the loss from that activity is reported on one form or schedule and no transactions need to be identified separately (as discussed in Worksheet 7, later). Also see Identification of Disallowed Passive Activity Deductions in Pub. 925 for more information.
Example.
You will report all the allowed loss from an activity listed in Worksheet 5 on Schedule E. Use Worksheet 6 to determine the allowed loss, even if part of the loss is a current year Schedule E loss and part of it is a prior year unallowed Schedule E loss.
On Worksheet 6, enter the name of each activity and the form or schedule and line number on which the loss is reported. See the Example for Worksheet 4. Identify each CRD from Worksheet 5 on a separate line and add "CRD" after the name of the activity.
Column (a).
For each activity entered in Worksheet 6, enter the net loss plus the prior year unallowed loss for the activity. Figure this amount by adding the losses in columns (b) and (c) of Worksheets 1 and 3 or enter the loss from column (c) of Worksheet 2.
Column (b).
For each activity entered in Worksheet 6, enter the amount from column (c) of Worksheet 5 for the activity. These are your unallowed losses for 2020. Keep a record of these amounts so the losses can be used to figure your PAL next year.
Column (c).
Subtract column (b) from column (a). These amounts are the losses allowed for 2020 under the passive loss rules. Report the amounts in this column on the forms and schedules normally used, subject to any further limitations described in Coordination With Other Limitations, earlier.
