If your deductions for the year are more than your income for the year, you may have an NOL.
There are rules that limit what you can deduct when figuring an NOL. In general, the following items are not allowed when figuring an NOL.
Capital losses in excess of capital gains.
The section 1202 exclusion of the gain from the sale or exchange of qualified small business stock.
Nonbusiness deductions in excess of nonbusiness income.
The NOL deduction.
The section 199A deduction for qualified business income.
Worksheet 1. Figuring Your NOL.
Use Worksheet 1 to figure your NOL. The following discussion explains Worksheet 1. See the Instructions for Form 1045. If line 1 is a negative amount, you may have an NOL.
Use this Worksheet for figuring your NOL: https://www.irs.gov/publications/p536#en_US_2021_publink1000177330
Net Operating Loss for Individuals: https://www.irs.gov/publications/p536
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