If you used TurboTax to file your tax return last year, any Passive Loss Carryovers would appear on Schedule E Wks - Carryforward to 2022 Smart Worksheet (note this is a TurboTax supplemental schedule and not an IRS form). This appears to be what you have posted above.
If entering the amounts from this worksheet in the Passive Loss Carryover screen posted above results in a double credit, then TurboTax is picking them up somewhere else. Preview all of the forms TurboTax has prepared from your entries to confirm how they are being reported. See here for details.
There are two kinds of passive activities:
- Trade or business activities in which you don’t materially participate during the year.
- Rental activities, even if you do materially participate in them unless you’re a real estate professional.
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. This special allowance is an exception to the general rule disallowing the passive activity loss. Similarly, you can offset credits from the activity against the tax on up to $25,000 of nonpassive income after taking into account any losses allowed under this exception.
You can only deduct suspended passive-activity losses in 2 situations:
Against passive-activity income
When you dispose of the passive activity in a fully taxable transaction to an unrelated party
When you converted the rental property into a personal home, and the rental home had suspended passive-activity losses, you can continue to deduct the suspended passive-activity losses from other passive income. If you have no other passive income, the suspended losses remain suspended until you dispose of the passive activity in a fully taxable transaction to an unrelated party.
However, if you are able to exclude the gain on the sale of the personal residence, then you still would not be able to use the suspended losses unless you had other passive activity income.
Please see IRS Publication 925, Passive Activity and At-Risk Rules, for more information.
See also this thread and this one for other discussions of these issues.
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