I think you might have Net Operating Loss (NOL) confused with capital loss. A NOL would result in you having more business losses than personal income, so the net loss would be carried over or back to other years. It would only be deductible in the current year to reduce your taxable income to $0 maximum, and any residual would be carried over to the next year.
A capital loss is a loss on investment sales typically, and is only deductible against capital gains and then up to $3,000 in the current year. The remainder gets carried over to future years.
Form 39R A(1) is asking for your NOL applicable to the current year. Line (2) is asking for your deductible capital loss applicable to the current year. I think the $110,626 may be your unused capital loss, in which case you should only enter $3,000 in line 2. Otherwise, your federal taxable income would be $0 most likely, as you had deducted $110,626 in NOL in the current year, and Idaho would be adding that back for the current year only.
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