@taxdean wrote:
Are you saying that the amount that must be used in the first year (in order to be able to carry anything forward) is determined by the lesser of $3,000 and whatever income they happen to have in that year, even if that income is in a very low tax bracket (and they would prefer to use the first bite to offset income in a later year when they expect to be in a higher bracket)?
I am not following what you wrote at all. The loss that is passed through is reported on their individual returns (from the K-1s) in its entirety. From that point, the loss can be used to offset any capital gains they might have and then, if the gains are brought down to zero, they can use up to $3,000 (of the excess loss) to offset any other income.
I apologize if I did not address your question specifically.
