From https://www.irs.gov/pub/irs-pdf/f6781.pdf :
The amount you can carry back to any prior year is limited to the smaller of:
• The gain, if any, that you would report on line 16 of Schedule D (Form 1040) for that carryback year if only gains and losses from section 1256 contracts were taken into account; or
• The gain, if any, reported on line 16 of Schedule D (Form 1040) for that carryback year.
An example scenario :
c/b year $18k net capital gains (from line 16 of Schedule D), but has a 1256 loss of of $10K b/4 c/b (from form 6781).
What is the c/b allowed (if any) in this scenario? Is it $18k, or zero?
