I did a test return and added K-1 information for a trust. I put in $25,000 for capitol loss carryover. I then added a $4,000 capital gain from a stock sale. I realize the limit for the loss carryover is $3,000 but TT showed a net loss carryover of $21,000 (25,000 - 4,000). Why did TT eat up an addition $1,000 capital loss carryover?
Also, how does TT know I have a loss carryover from 2025 for tax year 2026?
Thank you
