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Business & farm
Thanks for the info. However, I realize the question that I posted is too generalized and hence caused the unnecessary confusion. My apology for that. Let me put down the factitious specifics to avoid miscommunication, as I am trying to convey a rather simple situation.
- 5 people put in $1,000 each to form a multi-members LLC (taxed as partnership). Let's assume this is not a passive activity for the partners.
- Year 1, the partnership has a net operating LOSS of $500. Since it is a pass-thru entity, the partnership sent out K-1 to each member/partner that reported $100 loss to each.
- The tax code states this loss ($100) cannot be recognized for the year.
- Let's assume none of the partners want to liquidate.
So what the proper way for the partner to handle this $100 loss? Should the partner keep track this loss separately (outside TurboTax) and carry it forward to future years to offset any gains?
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