Yes, the Section 1256 losses can be carried back (up to three years) but cannot be an offset against ordinary income. The IRS provides the following information as to what you can carryback and how much:
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.
Here is a link to the above information:
Gains or Losses_Section 1256
Also, the carryback is allowed only to the extent it doesn’t increase or produce a net operating loss for the carryback year. The loss is carried to the earliest year first.
@00p299
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