I have 3 rental properties but sold only one this year. Correct. Schedule 1 line 17 is equal to Sched.E line 26 which is a difference between total Income Sched E line 24 (all 3 properties) minus losses (from all 3 properties Sched E line 25). Than, that Schedule 1 line 17 is used to calculate the positive adjustment to income on 1040 line 6 in order to calculate AGI.
I see your point..Schedule 1 line 17 = Capital Gain (Sched D line 16 Short term + Long term) minus total losses from Sched E, including my carryover passive loses for the property I've sold) . I expected those passive carryover losses to increase the adjusted basis of rental which would lower the capital gain.
However what puzzles me, Sched. 1 line 17 included the carried over passive losses on rentals I haven't sold yet. That doesn't seem right.
