Yes, your net income on the Schedule E should be zero. Remember to enter the loss carryover as a negative number.
If you marked the box for Active Participation in the property rental you would be allowed a loss of up to $25,000. According to IRS Pub. 925 - Passive Activity and At-Risk Rules:
If you or your spouse actively participated in a passive rental real estate activity, the amount of the passive activity loss that’s disallowed is decreased and you therefore can deduct up to $25,000 of loss from the activity from your nonpassive income.
