If your suspended losses were not automatically applied on your 2020 income tax, it could be that you have business losses in 2020. The suspended losses can't be used towards your regular income. if you're not able to deduct your rental losses,you may carry the total losses forward into future tax years to deduct against future rental profits. These losses can be carried forward indefinitely.
But, if you do have passive income, you may have to manually enter the losses in Turbo Tax:
- In the Search box on the top right of your screen, enter passive loss carryover, Schedule E and click on find at the right
- In the search result box, click on Jump to passive loss carryover, Schedule E
- The program will take you to the Income from Rentals section. Answer Yes
- Follow the interview.
- The screen Do any of these situations apply to this property?
- Put a check mark next to "I have passive real estate loss carried over from a prior year " and click Continue i
Passive losses can't be deducted against ordinary income with 3 exceptions:
- Active participation in the property such as approving tenants and expenditures, and other management duties.
- Material participation in the property such as participation in the operation of the rental property over 500 hours in a year.
- Real Estate Professionals includes listing agents, brokers, builders, contractors, leasing agents, and property managers.
