Owl5
Level 2

AMENDING CARRYOVER LOSS ON EARLIER RETURN

My brokerage incorrectly reported my cost basis of a bond that matured in 2020. The correct cost basis wasn’t available to the brokerage because I bought the bond before brokerages were required to keep cost basis records (so my cost basis is "non-covered"). I now want to amend my federal 2020 return in order to show the correct cost basis, which will then increase my carryover capital loss.

 

To amend my 2020 return I have to override TT’s cost basis amount. When I do this, TT correctly increases the carryover loss shown on the 2020 return.

 

Question #1:  Now, do I also need to amend my federal 2021 return simply in order to force TT, when preparing my 2022 return, to take into account my increased carryover loss?

 

When I amend my 2020 return, I have to override TT’s incorrect cost basis amount, which TT then identifies as an error. TT will also identify an override of my carryover loss as an error if I amend my 2021 return.

 

Question #2: If I also need to amend my 2021 return to get my capital loss to carry over to my 2022 return, will I then be prevented from filing my federal 2022 return electronically -- and maybe, from then on in for all future tax returns, also be prevented from filing electronically?  I believe that federal returns on which TT identifies an error can’t be filed electronically.

 

Thanks for answers to these two questions!